Snow falls as people wearing face masks walk through the Asakusa district on March 29, 2020 in Tokyo, Japan.
Tomohiro Ohsumi | Getty Images
SINGAPORE – Towards the end of 2020, many investors are viewing Asia as the region with one of the best economic prospects for the next year as it controls the region relatively better Coronavirus Outbreak.
However, a recent surge in Covid cases in some countries threatens to dampen the region’s economic outlook, some analysts have warned.
“For some of the Asian giants, this year’s problems with Covid-19 are unlikely to get better when the clock strikes 12 noon on New Year’s Eve,” said research firm Pantheon Macroeconomics.
That said, many parts of Asia – where the virus first appeared – remain lower than in Europe and the US, data from Johns Hopkins University showed.
But some countries are now struggling with a far worse resurgence than they did earlier in the pandemic. Even areas that have had great success in containing the virus must not be spared Taiwan reports its first locally transferred case this week since April 12th – highlights the difficulty of eradicating Covid.
Here’s a look at the Asian economies grappling with a renewed spike in coronavirus infections and how that would affect their economic prospects.
- Covid-19 balance sheet: 207,007 cumulative confirmed cases and 2,941 deaths as of Wednesday, according to Hopkins data.
The number of daily reported coronavirus infections in Japan rose again in November and topped 3,000 for the first time last week, Hopkins data showed.
Medical groups in the country warned that the pandemic will put a significant strain on the health system. according to Reuters. However, Japanese Prime Minister Yoshihide Suga failed to declare a state of national emergency – despite having announced it suspend a travel subsidy program In order to slow the spread of the coronavirus, the news agency reported.
Economists at Pantheon Macroeconomics wrote in a Wednesday report that the Japanese government’s “relatively soft” rules on social distancing don’t appear to be working and that this could lead to tougher measures in the coming months.
“Therefore, a second and more effective nationwide state of emergency in Japan early next year cannot be ruled out,” the economists said. That would weigh on Japan’s economy in the first quarter of 2021, they added.
- Covid-19 Record: According to Hopkins, there were 53,533 cumulative confirmed cases and 756 deaths on Wednesday.
As in Japan, in South Korea daily new cases reached unprecedented levels this month – above 1,000 for the first time since the outbreak.
But unlike in Japan, the government in South Korea has taken a tougher stance in response to the new wave of Covid cases.
The government announced on Tuesday a nationwide ban on gathering five or more peopleand ordered tourist attractions – such as ski slopes and other winter sports facilities – to be closed, the Yonhap news agency reported.
This move, according to Pantheon Macroeconomics, would allow most of South Korea’s economic damage to be contained for most of the fourth quarter of this year.
- Covid-19 balance sheet: 98,737 cumulative confirmed cases and 444 deaths on Wednesday, according to Hopkins data.
The Southeast Asian country brought Covid cases before last increase from OctoberHopkins data showed. This prompted the government to impose a new round of partial closure measures in some parts of the country.
Economists with consulting firm Capital Economics said the outlook for the Malaysian economy had become “less optimistic” this quarter, particularly in terms of consumer spending.
“A second wave of the virus and the reintroduction of many restrictions on movement have reversed the strong recovery in private consumption in the third quarter. The high-frequency Google mobility data suggests social distancing continues to weigh on activity,” a report said Tuesday.
But the other parts of the economy – like exports – should continue to perform strongly, so the macroeconomic success of the recent resurgence is likely to be “much less” than the previous wave, the economists said.