Southeast Asia seeks to live with the Covid-19 epidemic, save the economy

Even as it grapples with one of the world’s worst Covid-19 outbreaks, many countries in Southeast Asia are slowly realizing that they can no longer afford to prolong the restrictive measures against the virus. Severe epidemic paralyzed the economy. Therefore, some countries are considering reopening plans.

The balance problem between economic development and anti-epidemic

At factories in Malaysia or office buildings in Singapore, regulators are pushing for a reopening plan, finding a balance between containing Covid-19 and the movement of cash and cash flows. Human Resources. That has led to a series of experimental measures such as, allowing workers to isolate and work in place, deploying the military to help provide food for the people, blockade by area, or Only those who have been vaccinated should visit the office or restaurant.

In contrast to the US and Europe, which are slowly reopening, low vaccination rates have made Southeast Asia one of the most vulnerable regions in the world to the Delta variant. But in the face of an increasingly tight state budget due to the effects of previous epidemics and the weakening of the currency, blockade measures are becoming less and less feasible.

Krystal Tan, an economist at Australia & New Zealand Banking Group in Singapore, said: “The balance between fighting the epidemic and ensuring the economy is an extremely difficult problem.” According to this expert, even Singapore – one of the countries with the highest vaccination rate in the world is struggling to cope with the increase in the number of cases due to the new mutation, so if the regions with high vaccination rates The lower the vaccination rate, the higher the risk of reopening.

During the outbreak of the epidemic, many factories in Southeast Asia had to shut down, disrupting supply chains, causing car manufacturers such as Toyota Motor to have to cut production. US clothing and footwear retailer Abercrombie & Fitch warned the situation was “getting out of control”.

The daily mortality rate in many Southeast Asian countries has exceeded the global average, causing these countries to fall to the bottom of the Bloomberg Covid-19 Resilience Ranking.

However, many officials in the region fear that the economy could collapse if the restrictions are prolonged too long. Malaysia has cut its 2021 economic growth forecast in half to 3 to 4%. Hopes of economic recovery from the revival of Thailand’s tourism industry also quickly dissipated.

“Fantastic Dreams”

Even if there is optimism about the economic outlook, for example Vietnam is expected to grow 6% this year and Singapore is expected to grow at around 7%, pressure on resolving supply chain bottlenecks global response and reduced foreign investment attraction to an increasingly dynamic economic region.

According to economist Wellian Wiranto of Oversea-Chinese Banking Corp, the economies of Southeast Asian countries are weakening due to successive blockades, and people are gradually feeling exhausted as the crisis drags on.

“Any hope of opening borders, helping to facilitate the flow of trade and tourism across the ASEAN region remains a distant dream.”

People’s patience is dwindling in Southeast Asia, especially as they have been battling the Covid-19 outbreak for longer than most other regions of the world. In Malaysia, people protested after the government extended the blockade measure, leading to a high rate of job loss but the number of cases showed no sign of abating.

In Singapore and the Philippines, businesses are facing difficulties in making long-term production and business plans due to the restrictions against the epidemic.

Change strategy

Currently, some countries in Southeast Asia such as Malaysia, Indonesia, Thailand and Singapore have begun to change their perception, thinking that the epidemic will not disappear completely and shifting from a “case-free” strategy. to a strategy of “living with the virus”.

Indonesia, the region’s largest economy, is looking to play the long game. The country focused on strengthening regulations such as wearing masks instead of imposing restrictions on movement. They also issued “movement maps” for special areas such as offices and schools, to familiarize people with many of the regulations that are expected to apply in the long run in the new normal.

Instead of counting cases by day, countries focus on limiting the number of deaths or severe cases. This is especially true of the two countries with the highest vaccination rates in Southeast Asia, Singapore and Malaysia, with fully vaccinated people accounting for over 80% and around 50% of the population, respectively.

The Philippines is considering applying travel control measures in each specific region based on the Covid-19 situation. For example, people in hot spots may be restricted from going out or even leaving their homes.

In the Indonesian capital, Jakarta, only those with vaccination certificates can visit shopping malls or churches. Malaysia has also taken similar measures. And officials in the capital Manila (Philippines) are considering introducing a “vaccine bubble” (allowing fully vaccinated people to travel and visit certain destinations without being quarantined upon arrival– ND) at work and public transport. According to the assessment, these strategies can help reduce damage to the economy.

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