"A rebound in full throttle for the meantime is not expected—not when the contagion is still around."
The Asian Development Bank no longer expects a quick recovery in the economies of the Asia Pacific region next year. Even the pace of recovery is not crystal clear. The availability of a vaccine to neutralize COVID-19 remains the X factor.
The lending institution sees a “swoosh-shaped” recovery for the ravaged economies of Asia Pacific that stretches from the Cook Islands in the Pacific Ocean to Kazakhstan in Central Asia. This type of recovery, as opposed to a V-shaped or a more vigorous one, is a slower rebound because of several factors—foremost of which is the capability of nations to contain the pandemic.
The economies of Asia Pacific will surely bounce back after bottoming out in the second quarter when varying degrees of lockdowns were imposed in the region. But a rebound in full throttle for the meantime is not expected—not when the contagion is still around.
The ADB sees the region contracting this year before growing 6.8 percent in 2021, noting the resiliency of developing Asia. But the bank strongly warned against the reimposition of lockdowns and other forms restrictions, saying they could derail the recovery and even spark “financial turmoil.”
The ADB, meanwhile, sees the Philippine economy shrinking by 7.3 percent this year, deeper than its previous estimate of a 3.8-percent decline. It expects the local economy to recover 6.5 percent in 2021, on expectations the health crisis will be over by that time.
The rate recovery, of course, is dependent on how the global economy fares. The Philippines relies heavily on trade investment and remittances of its migrant workers.
For Acting Socioeconomic Planning Secretary Karl Kendrick Chua, opening the local economy in the safest possible way will be the key to full recovery. The pandemic largely affected the urban areas of Metro Manila, neighboring provinces and Cebu. The government, thus, must pump prime the economy to create and restore jobs, while ensuring the safety of the population.
The road to economic recovery will not be smooth as the COVID-19 danger still lurks around. Taking the route with caution, however, will reward the traveler at the end of his journey.