Developing nations in the East Asia/Pacific region will take a major hit economically due to the coronavirus outbreak. According to a report by the World Bank published yesterday, Southeast Asian countries like Thailand and Malaysia are expected to deal with the biggest losses, while Vietnam could be lucky enough to record a below average decrease in its economic activity.
Countries that rely on tourism heavily (Thailand, Cambodia) are vulnerable in this crisis, as are countries which carry high debts (Thailand, China, Malaysia, Vietnam). Yet, Vietnam profits from picking up slack left by decreasing Chinese exports. The country’s manufacturing sector had been taking over certain market segments even before the crisis as the Chinese economy is transitioning to a higher value-added model.
The report also offers some perspective on the much-discussed performance of Singapore and South Korea as being countries very effective at reigning in COVID-19 outbreaks among their populations. Experience with SARS (2003) and MERS (2015) is cited by the World Bank as a factor in the countries’ coordinated response.
It was now up to governments to flatten the curve of infections as well as the curve of recession, the report states - because economic cost was “ultimately also a human cost.”