ADB slashes Vietnam and Malaysia GDP forecasts as Philippines, Singapore and Thailand upgraded

• Dec 15, 2021

The Asian Development Bank (ADB) trimmed its forecast for ASEAN growth this year from 3.1 percent to 3.0 percent, with downgrades for Vietnam and Malaysia offset by improved forecasts for the Philippines, Singapore and Thailand.

In a supplement to the update of its Asian Development Outlook in September, the ADB almost halved its GDP growth forecast for Vietnam from 3.8 percent to 2.0 percent and cut its Malaysia forecast from 4.7 percent to 3.8 percent.

But the bank raised its forecast from 4.5 percent to 5.1 percent for the Philippines, from 6.5 percent to 6.9 percent for Singapore and from 0.8 percent to 1.0 percent for Thailand. Indonesia’s forecast was unchanged at 3.5 percent.

Forecasts for GDP growth in Cambodia and the three other ASEAN economies — Brunei, Laos and Myanmar — weren’t available.

The bank said it shaved 0.1 of a percentage point off the 2021 forecast for the six main ASEAN economies to reflect targeted restrictions in the face of the Delta variant of Covid-19.

“Next year’s growth forecast is increased to 5.1 percent as economies are expected to continue easing overall restrictions and reviving economic activities,” the bank said. The higher forecast for 2022 compares with 5.0 percent in the September supplement.

But Joseph Zveglich, the ADB’s acting chief economist, warned that the emergence of the Omicron variant of the SARS-CoV-2 virus was causing “renewed uncertainty” across developing Asia.

“Recovery efforts will have to take these developments into consideration,” Zveglich said.

The supplement described Omicron as a “sobering reminder that further outbreaks remain a possibility.” Sao Da – AKP