New Infection Surge Damages Economic Prospects
All Economists Prioritize Quick Vaccination
The Japan Center for Economic Research and Nikkei conducted the twenty-second quarterly consensus survey on Asian economies from June 5 to 24, collecting 31 answers from economists and analysts in the five biggest members of the Association of Southeast Asian Nations—Indonesia, Malaysia, the Philippines, Singapore, and Thailand—and in ew surge of COVID-19 cases in the second quarter of 2021 damaged recovery prospects in most countries. The average growth rate of the five ASEAN countries in 2021 was 4.1%, down 0.2 points from the previous survey. That of India in fiscal 2021 (2021/2022) fell more severely, by 1.5 points to 9.7%.
The outcome of this survey was also reported at Nikkei Asia. (July 5, 2021)
◆ Main points of the survey
- A new surge of COVID-19 cases in the second quarter of 2021 damaged recovery prospects in most countries. The average growth rate of the five ASEAN countries in 2021 was 4.1%, down 0.2 points from the previous survey. That of India in fiscal 2021 (2021/2022) fell more severely, by 1.5 points to 9.7%.
- Malaysia’s growth rate in 2021 was down 1.2 points to 4.1%, the sharpest downward revision after India. The Philippines and Thailand also followed the downward trend, but both have fared better than Malaysia in terms of new infection cases.
- Exceptions are Indonesia and Singapore. In Indonesia, which seems comparatively successful in containing COVID-19, recovery of consumption will drive the economy. In Singapore, recovery of exports supported by a global demand surge will help economic growth.
- “Corona shock” still lingers as the largest risk facing the Asian economy. All economists agree on quick vaccination as the most important measure to effectively contain the spread of COVID-19.
- Many economists identified “Inflation” and “U.S. monetary policy” as the next-greatest risk factors after “Corona shock.” U.S. monetary policy has great influence on both currency exchange rates and policy interest rates in Asian countries.
Indonesia: Dendi Ramdani, head of industry and regional research department, Bank Mandiri; Umar Juoro, senior fellow, The Habibie Center; Wisnu Wardana, economist, PT Bank Danamon Indonesia Tbk.; Juniman, chief economist, Maybank Indonesia
Malaysia: Suhaimi Ilias, chief economist, Maybank Investment Bank; Wan Suhaimie bin Wan Mohd Saidie, head, economic research, Kenanga Investment Bank; Vincent Loo Yeong Hong, senior economist, KAF Research
Philippines: Alvin Ang, director, Ateneo Center for Economic Research and Development, Ateneo de Manila University; Jonathan Ravelas, chief market strategist, BDO Unibank Inc.; Pauline Revillas, research analyst, Metrobank; Carlo Asuncion, chief economist, Union Bank of the Philippines; Mitzie Conchada, associate dean, school of economics, De La Salle University
Singapore: Manu Bhaskaran, CEO, Centennial Asia Advisors; Randolph Tan, director, Centre for Applied Research, Singapore University of Social Sciences
Thailand: Panundorn Aruneeniramarn, assistant vice president, Siam Commercial Bank – Economic Intelligence Center; Lalita Thienprasiddhi, senior resercher, Kasikorn Research Center; Somprawin Manprasert, head of research division and chief economist, Bank of Ayudhya PCL; Amonthep Chawla, head of research, CIMB Thai Bank
India: Punit Srivastava, head of research, Daiwa Capital Markets India; Dharmakirti Joshi, chief economist, CRISIL; Sonal Varma, India chief economist, Nomura India; Tirthankar Patnaik, chief economist, National Stock Exchange of India; Jyoti Vij, deputy secretary general, the Federation of Indian Chambers of Commerce and Industry (FICCI); Chandrajit Banerjee, Director General, Confederation of Indian Industry
For multiple countries: Euben Paracuelles, senior economist, Nomura Singapore; Nicholas Mapa, senior economist, ING Bank Philippines
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