The outlooks for Asian economies have greatly deteriorated due to the impact from the corona shock. With the ongoing spread of the novel coronavirus, Asian economists have drastically lowered their growth projections.
Some forecasts see negative growth rates for 2020 in Singapore and Thailand. Indonesia, the Philippines and India face the end of rapid growth of about 5% or more in the past several years. Further downward revisions are expected if the virus is not contained.
An increase in unemployment is projected throughout the region. Economists now express concern about potential social impact from the shock, a survey shows.
The Japan Center for Economic Research and Nikkei conducted a quarterly consensus survey from March 6 to March 26, collecting 33 answers from economists and analysts in the five biggest ASEAN members -- Indonesia, Malaysia, the Philippines, Singapore, and Thailand -- as well as in India.
The 2020 growth projections for the five ASEAN economies were revised down significantly from the previous survey in December. Coronavirus infections have spread worldwide since January, and have been hitting the global and Asian economies. Some economists held off answering growth forecasts this time as they had not finished their revisions.
The economies of export-oriented Singapore and Thailand were projected to be especially damaged. Economists predicted the growth from minus 0.4% to 0% for Singapore in 2020. Half of the economists foresaw negative growth rates for Thailand in 2020.
Manu Bhaskaran of Centennial Asia in Singapore, who predicted minus 0.4% growth, said “the virus crisis will worsen in the U.S. and Europe, depressing global demand which will hurt Singapore through 2Q20.” Somprawin Manprasert of Bank of Ayudhya forecast minus 0.8% growth for Thailand in 2020. “The outbreak would not only hit tourism and related sectors,” he said, “but also the Thai economy via supply disruptions in many countries and negative income effects.”
For Malaysia, Vincent Loo Yeong Hong of KAF Research forecast the 2020 growth rate falling to 0.5% from the 4.3% achieved in 2019. He foresees a “sharp drop in 1Q20-2Q20 ... caused mainly by a nationwide lockdown from March 18.”
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