KUALA LUMPUR — The International Monetary Fund (IMF) believes Asia’s fast-growing economies will “come to a standstill” due to the coronavirus pandemic, faring worse than during the 2008-9 global financial crisis or the 1997-98 Asian crash. The region will experience zero growth for the first time since the 1960s, said Chang Yong Rhee, director of the IMF’s Asia and Pacific Department, who forecast that the economic impact of the pandemic will be “severe, across the board, and unprecedented.” Speaking during a press conference live-streamed from Washington, Rhee said Asia faces “a crisis like no other” due to the pandemic, which has killed over 136,000 people worldwide and prompted governments to impose lockdowns that have hampered commerce. “Containment measures are severely affecting economies,” Rhee said.
KUALA LUMPUR — Prime Minister Lee Hsien Loong warned Singaporeans on Saturday to expect more deaths from the coronavirus outbreak after the city-state’s first fatalities were announced earlier in the day.
“As we get more COVID-19 cases, more patients will need ICU [intensive care unit] care, and we must brace ourselves for more losses,” Lee said in a Facebook post.
Earlier Health Minister Gan Kim Yong announced the deaths of a 75-year-old Singaporean woman and a 64-year-old Indonesian man who had been diagnosed with Covid-19, the respiratory disease caused by the new coronavirus. “We are deeply saddened by their passing,” Gan said, explaining that the woman had several medical conditions and was admitted to hospital a month ago with pneumonia.
JAKARTA – The Maritime and Port Authority (MPA) of Singapore said that the Costa Fortuna cruise vessel will dock at the city-state on March 10. The ship, which is carrying over 2,000 passengers, including 64 Italians, was refused entry to Phuket in Thailand and Penang in Malaysia over concerns about coronavirus, as the number of cases in Italy surged. The MPA and the Singapore Tourism Board said that the ship’s passengers, who departed Singapore on March 3, could disembark as they had “completed pre-embarkation checks based on prevailing policies for travel history and temperature screening as required by the cruise line and the terminal operator prior to boarding.”
KUALA LUMPUR — A report published on Monday listed Malaysians as the biggest per capita users of plastic packaging in a region responsible for more than half the plastic litter in the world’s oceans. The report by the World Wide Fund For Nature (WWF) covers China, Indonesia, Malaysia, the Philippines, Thailand and Vietnam, which together account for “around 60 per cent of plastic debris entering the ocean.” The average Malaysian uses 16.78 kilograms of plastic packaging each year, according to WWF estimates, with Thailand next at 15.52 kg per person per annum. “Rapid economic growth has led to an immense increase in the use of plastic, especially for packaging consumer goods,” the WWF stated, linking plastic use with rising affluence across the region.
KUALA LUMPUR — Southeast Asia is the region most vulnerable to the new coronavirus outbreak, which has killed 170 people in China and infected almost 8,000 since the turn of the year. Several dozen cases of the virus have been reported across the region, with 14 confirmed in Thailand — the most of any country outside of China — as of Jan. 28. By Jan. 30, 10 cases were reported in Singapore. Hundreds more people are under medical observation or in quarantine, pending confirmation of infection or a disappearance of symptoms. The number of cases in Malaysia rose to eight on Jan. 30. “It looks like the volume of airline travelers from cities in mainland China are highly correlated with the number of cases reported in affected countries,” said Shengjie Lai of the University of Southampton, co-author of an analysis of travel trends within and from China which aims to predict what places might be most at risk of further outbreak. Of the 30 most exposed cities outside China, 14 are in Southeast Asia, with Bangkok facing the highest risk globally. Singapore, Phuket, and Kuala Lumpur are among the 10 cities most at risk. Seven of the 14 countries deemed most vulnerable are in Southeast Asia, according to the study, which was published on Jan. 28.
BANGKOK — A confluence of drought and dams along the Mekong River has renewed concerns about the future of the 4,763 kilometer waterway, upon which tens of millions of people depend for their livelihoods in Cambodia, Laos, Myanmar, Thailand and Vietnam. The number of dams impeding the Mekong’s flow is fast multiplying, drying up segments of the once fast-flowing river and leaving the region facing imminent drought, according to the Mekong River Commission (MRC), a regional intergovernmental body that aims to jointly manage the river’s water resources. “China’s operators of the Jinghong Dam and the Thai operators of the newly opened Xayaburi dam in Laos conducted operations that actually exacerbated the drought,” said Brian Eyler, director of the Southeast Asia program at the Stimson Center, a US think tank. “Those dams and more than 70 others now operational in Laos and China all contribute to deteriorating downstream conditions related to the drought.”
PHNOM PENH — The world’s proposed biggest free trade agreement was dealt a blow on Monday when India made a last minute but unsurprising withdrawal from seven-year-old negotiations during a series of weekend meetings of Asian governments in Bangkok. The Regional Comprehensive Economic Partnership, or RCEP, would have encompassed all ten members of the Association of Southeast Asian Nations (ASEAN), as well as Australia, China, India, Japan, New Zealand and South Korea. It also would have made for the world’s biggest trade deal measured by population and factoring in the combined gross domestic products (GDPs) of the putative signatories, though India’s withdrawal could see it drop below the Canada-Mexico-United States deal formerly known as NAFTA in combined GDP. India would have been the third largest economy in the tariff-reducing trade deal.
PHNOM PENH – Going by the sometimes breathless reports about how well Vietnam has done out of the US-China tariff joust, a reader would be forgiven for thinking that an authoritarian single-party state where farmers make up 40% of the workforce has been transformed into a kind of scaled-up Singapore, which despite its small size usually sucks in around half the annual foreign investment bound for Southeast Asia. The numbers in so far suggest that Vietnam’s trade war triumph is indeed nigh. Its economy grew by just over 7% in 2018 – though that has dipped a notch, according to government statistics, to around 6.7% so far this year. But even that slight fall-off will nonetheless make for high growth – due in part to record levels of foreign investment, including some business seemingly diverted to Vietnam as American tariffs add to the cost of exporting to the US from China. “Following the US-China trade tensions, there is evidence of companies making adjustments to avoid the high tariffs situation,” said Bansi Madhavani, economist at ANZ Research, part of Australia and New Zealand Banking Group. According to Madhavani’s counterparts at Maybank Kim Eng, part of Malaysia’s Maybank, Vietnam “is emerging as the biggest beneficiary” of those adjustments, “with FDI [foreign direct investment] registration up by +86% in the first quarter of 2019”.
PHNOM PENH – Tax And Spend has rarely been part of the Southeast Asian governance lexicon. And judging by the region’s dismal tax-to-gross domestic product (GDP) ratios, it doesn’t look like that will be changing anytime soon. Newly published revenue statistics compiled by the Paris-based Organisation for Economic Co-operation and Development (OECD) show that the five biggest Southeast Asian economies have ratios of half or less than the 2017 OECD average of 34.2%, though most countries in the region showed small increases in revenues compared with the previous year. The OECD defines the tax-to-GDP ratio as “total tax revenue, including social security contributions, as a percentage of GDP”. While more prosperous countries in Southeast Asia’s vicinity such as Australia, Japan and New Zealand all come in around the 30% mark, Southeast Asia’s own numbers were much lower, with Indonesia at 11.5%, Malaysia on 13.6 and Singapore only slightly above on 14.1. This last number in particular seems surprisingly low given that Singapore’s economy more resembles higher-tax Western counterparts than its neighbours in Southeast Asia.
PHNOM PENH – Cambodia appears to be the latest beneficiary of the US-China trade war, joining the already exhaustively profiled Vietnam among the countries enjoying increased exports to the US as tariffed Chinese goods open the door for other cheap suppliers. Latest US government data show annual imports from Cambodia rising significantly since the start of the year, with the US$1.8 billion registered from January-May a roughly 20% increase on the same period last year. Like Vietnam, Cambodia has duty-free access to American markets under the Generalized System of Preferences, a trade program designed to promote economic growth in the developing world. Trade represented 125% of Cambodia’s gross domestic product (GDP) in 2017, according to the World Bank. In 2018, the bulk of Cambodia’s goods exports to the US were clothing and footwear, with the Office of the US Trade Representative listing the top four sectors as knit apparel ($1.8 billion), woven apparel ($628 million), leather products ($390 million), and footwear ($329 million). Cambodia’s 2018 trade surplus with the US was $3.4 billion — which, though relatively-small compared with Vietnam’s near-$40 billion for the same year — will continue to rise this year as Cambodia’s exports to the US surge. Parsing the numbers for a direct trade war link is not as clear-cut as it may seem, however, with both Vietnam – where trade represented 188% of GDP in 2018 – and Cambodia expanding their commerce with the US since before the start of the tariff war.