RESILIENT ASEAN ECONOMIES
Region will continue to grow quite well, albeit more slowly, says S’pore minister
SINGAPORE and other Southeast Asian economies are poised to remain resilient in the face of increasingly dour signs on the global economy, said its Finance Minister Heng Swee Keat.
Economies in the 10-member Asean “and Asean as a group both continue to grow quite well even this year and next”, said Heng on the sidelines of meetings of the regional bloc, here, yesterday. “There will still be growth even though the growth will be uneven across the world and it’ll be slower than before.”
Global growth has lost momentum since the beginning of the year, a knock for trade-reliant nations in Southeast Asia, especially
Singapore.
For now, regional growth seems to be holding up, with the Asian Development Bank forecasting a 4.9 per cent expansion this year.
In Singapore, authorities see growth easing to slightly below the midpoint of a 1.5 to 3.5 per cent range this year, after reaching 3.3 per cent last year, with inflation remaining benign.
Heng said the growth forecast wasn’t being revised at this stage.
He reiterated that a potential worsening of the United StatesChina trade war was a risk to the global economy, with the two powers yet to ink an agreement that would relieve any of the tariffs put in place on US$360 billion (RM1.48 trillion) in goods.
Brexit uncertainties and a general malaise among workers about how to adapt amid rapid technological change also weigh on world growth prospects.
“The investment sentiment has been affected, uncertainty has increased,” said Heng. “For investors making long-term investments, making major investments, they would adopt a waitand-see approach, and this can in turn affect sentiments further.”
In Southeast Asia, regional economies were benefiting as companies adjust supply chains to take account of rising tariffs in the US and China, he said.
Conversations with investors “have been generally quite positive, still,” Heng said.
“There is a sense that the global supply chain is re-configuring quite rapidly and now people are thinking about the resilience of the supply chain”, which meant diversification and movement of operations to Asean economies, he said.