Full recovery for Vietnam, Indonesia and Malaysia in 2021
The projected recovery patterns of the six countries were based on the International Monetary Fund’s country-based projections for real gross domestic product, with 2019 figures as a baseline of 100, compiled by Nikkei Asia.
Vietnam, Indonesia and Malaysia all scored above the 100 mark, meaning their economies are projected to see expansion in 2021 compared with levels before the pandemic outbreak in 2019.
Vietnam scored the highest with a projected growth index of 108.4. The Vietnamese economy is expected to expand 10.9% in real terms in 2021, more than any other country in the Asia-Pacific, following a 2.91% uptick this year, according to S&P Global.
Vietnam was also the only one of the six to log real economic growth in 2020, thanks to its quick success in curbing the coronavirus pandemic. Its leadership also bolstered effective demand through public projects ahead of the Communist Party Congress that begins there in January.
Indonesia came in second with a growth index of 104.5. The so-called omnibus law on job creation signed by President Joko Widodo last November is expected to give companies greater freedom and help attract foreign investment when it takes effect.
Malaysia, with an index of 101.3, could also see exports of mainstay products like electronics recover once the global economy stabilises.
On the other hand, Singapore, the Philippines and Thailand are not expected to cross the 100 mark until 2022.
Thailand’s tourism sector, which accounts for about 20% of GDP, is seen struggling next year as well, with no clear end in sight for entry restrictions on foreign travelers. Auto exports, a key driver for growth, are also unlikely to recover to 2019 levels.
The Philippines’ outlook on consumer spending is murky, given a slowdown in sales of cars and other durable goods.
Singapore’s tourism sector will likely also see a slow recovery.
Despite differences in their individual forecasts, all six countries would be affected by global developments pertaining to the coronavirus and US policies under President-elect Joe Biden after he takes office on January 20th.