Posted on 24 Apr 2020
Greetings from SEAISI!
Continuing Spread of COVID-19
Another month has passed and the world continues to be impacted by the alarming spread of the COVID-19 virus globally. Amidst this, answers are being sought as to what the future is going to look like.
IMF Forecast for 2020 and 2021
On 14 April 2020, IMF released their forecast. The global economy will shrink by 3% in 2020, because “the COVID-19 pandemic is inflicting high and rising human costs worldwide” and is “having a severe impact on economic activities”.
Global economic growth for 2021 is forecasted to be 5.8%. This assumes “the pandemic fades in the second half of 2020 and containment efforts can be gradually unwound”. Normalisation of activities and governments’ support policies will lead to improvement in global economy.
For our member countries, IMF forecasted that Indonesia, Myanmar, Philippines and Vietnam are likely to avoid a negative growth in 2020.
While the economies of Malaysia, Singapore and Thailand are forecasted to shrink in 2020, all will see a rebound to positive economic growth in 2021.
Similarly, for our supporting member countries, the economies of Australia, South Kore and Taiwan, are expected shrink in 2020 and rebound in 2021.
Of the advanced economies, India and China are forecasted to see positive economic growth, albeit lower levels.
IMF Forecast (April 2020)
|
IMF Forecast for: |
2020 |
2021 |
|
Indonesia |
0.5 |
8.2 |
|
Malaysia |
-1.7 |
9.0 |
|
Myanmar |
1.8 |
7.5 |
|
Philippines |
0.6 |
7.6 |
|
Singapore |
-3.5 |
3.0 |
|
Thailand |
-6.7 |
6.1 |
|
Vietnam |
2.7 |
7.0 |
|
Australia |
-6.7 |
6.1 |
|
South Korea |
-1.2 |
3.4 |
|
Taiwan |
-4.0 |
3.5 |
|
Japan |
-5.2 |
3.0 |
|
India |
1.9 |
7.4 |
|
China |
1.2 |
9.2 |
|
Euro Area |
-7.5 |
4.7 |
|
United States |
-5.9 |
4.7 |
|
World |
-3.0 |
5.8 |
The IMF also highlighted “there is extreme uncertainty in the global growth forecast”, given the complexity of the impact.
They recommend that governments implement economic policies to cushion the impact of declining activities. Similarly, policy makers also need to” implement substantial targeted fiscal, monetary, and financial market measures to support affected households and businesses” and to scale up fiscal measures where necessary.
Construction Industry Inactivity (ASEAN)
Over the past month, ASEAN countries have announced various forms of movement controls, from the barring of visitors, social distancing policies, restricting movements to some forms of partial.
Based on the announcements by the various ASEAN Governments, the construction Industry is affected by the temporary mandated closure. Along with this, the steel industry is also similarly impacted.
In particular, construction activities have halted in Malaysia, Philippines and Singapore, with the Philippines construction heading towards a very long shutdown.
In the meantime, some construction projects have stopped or are delayed in Bangkok. Meanwhile, some construction activities continue elsewhere in Thailand.
In Myanmar, while social distancing and movement restrictions are in place, some regional authorities allow construction activities to continue.
Only Indonesia and Vietnam do not require construction projects to stop as at mid-April. In Vietnam, businesses are allowed to continue operations but they have to implement safe distancing measures.
Days of Inactivity (Construction Industry)
|
Construction Industry in: |
Measure |
Days of Inactivity |
|
Indonesia |
SM |
? |
|
Malaysia |
SML |
42 max# |
|
Myanmar |
SM |
? |
|
Philippines |
SM |
184 |
|
Singapore |
SML |
55 |
|
Thailand* |
SML |
40 |
|
Vietnam |
SML |
? |
Legend:
· S = Social Distancing Measures
· M = Movement Restriction (including no mass gatherings and restricted travel)
· L = Localised Lockdown Areas in Country
· Days of Inactivity = number of days construction industry have to temporarily close as mandated by the various government announcements.
· Thailand* = SML measures only applied to Bangkok
· ? = some unquantifiable impact from delays
· Max# = Construction and steel industries are allowed to restart operations, but the implementation is taking time, pending clearer guidelines on the process. 42 days is the announced Movement Control Order (MCO) from 18 Mar - 28 Apr 2020.
More analysis in headline news inside.
Stay Healthy & Be Safe
COVID-19 does not discriminate on the basis of wealth, status, race, ethnicity, religion or nationality. Neither should we.
YEOH WEE JIN
Source:SEAISI
