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Manila – Coronavirus-ravaged economies in the Asia-Pacific region will recover “swoosh” next year, the Asian Development Bank announced Tuesday, but warned that new restrictions to combat contagion can derail the region’s return to growth.
Developing Asia, stretching from the Cook Islands in the Pacific to Kazakhstan in Central Asia, is expected to contract in 2020 for the first time in nearly six decades, leaving tens of millions of others in poverty, the Philippine-based lender said. .
The 0. 7% drop in gross domestic product compares to the bank’s previous estimate in June for an expansion of 0. 1% and will mark “the first contraction in regional GDP since the early 1960s,” he said.
“The slowdown is widespread, and nearly three-quarters of regional economies are expected to contract, the highest percentage in the past six decades,” the bank said in the latest update to its forecast.
While the vast region is expected to recover next year, with expected GDP expansion of 6. 8%, it will be “significantly smaller” than expected before coVID-19 attacks.
“Therefore, the regional recovery will be in the form of L or Swoosh” rather than a V-shape,” the bank said, noting that an extended pandemic is the biggest risk to the outlook.
The bank warned that the reimposition of strict viral restrictions could hamper recovery and even lead to a “financial crisis. “
“While future Asian economies remain resilient, an ongoing policy is needed for recovery,” said AfDB chief economist Yasuyuki Sawada.
Policy systems announced at the end of August totaled $3. 6 trillion, or about 15% of regional GDP, the bank said.
China, where the virus first expired last year before becoming a pandemic that infuriated more than 29 million people worldwide, one of the few economies to oppose the downward trend in the region.
After effectively defending against the disease, the world’s second-largest economy is expected to grow by 1. 8% this year and 7. 7% in 2021, the bank said.
By contrast, India, one of the world’s most affected countries with more than 4. 8 million infections despite long blockades, is expected to fall to 9% by 2020 before growing to 8% next year.
“The path and speed of economic recovery in regional economies will depend on many other factors, the ultimate vital of which is the ability to involve the pandemic,” the AfDB said.
As regional economies contract this year, the number of deficient people is likely to accumulate at least 78 million, reversing poverty alleviation over the past 3 or 4 years, according to the report.
However, inflation is expected to “moderate” due to declining demand and lower oil prices, he said.
Negotiate some other positive relative. While exports from the region contracted, they achieved better results than the rest of the world thanks to a stronger demand for COVID-related electronic and fitness products.
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