The Asia-Pacific region is expected to lead global recovery once dust from the COVID-19 pandemic settles, with the Philippines among only a few economies seen to eke out modest growth in 2020, the Washington-based global financial industry association Institute of International Finance (IIF) said.
“Buoyed by positive growth outlooks in China, Indonesia, and the Philippines, Asia-Pacific is the only region likely to see positive growth in 2020,” the IIF said on Wednesday (April 15).
For 2020, the IIF projected China’s economy to grow 2.1 percent; Indonesia, 1.8 percent; and the Philippines, 1 percent.
But the IIF’s 2020 gross domestic product (GDP) growth forecast for the Philippines was downgraded from 2.6 percent in its report last March.
Amid the pandemic, the Philippine government expects GDP to post zero growth at best, and contract by 0.8 percent at worst.
Across the region, “emerging Asia is likely to lead the world in a recovery of non-resident portfolio flows as a result of recovering economic activity,” the IIF said.
“Emerging Asia was particularly affected by capital outflows at the beginning of the COVID-19 pandemic, but as the pandemic spread, other EMs began to suffer significant outflows as well,” the IIF noted, referring to emerging markets.
The IIF projected the Asia-Pacific region to grow by 1.4 percent this year, even as the economies of India, Malaysia, South Korea and Thailand would contract.
All other regions were expected to post economic contraction in 2020—Latin America, by 5 percent; Emerging Europe, negative 4.7-percent growth; and Africa and Middle East, minus 2.3 percent.
The IIF forecast the world economy to contract by 2.8 percent, with mature markets posting negative 4.4-percent growth, while emerging markets contracting by 0.5 percent.
Edited by TSB
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