Pandemic to keep Asia’s growth at lowest for over 50 years
September 29, 2020 - The developing East Asia and the Pacific region has been badly hit by the coronavirus pandemic. While China is forecast to grow by 2.0 percent in 2020, the rest of the EAP is projected to contract by 3.5 percent, according to the World Bank.
Including China – which has seen a better than expected recovery from the pandemic due to government spending, strong exports and a low rate of new Covid-19 infections – the region is expected to grow by 0.9 percent in 2020, still the lowest rate since 1967.
Prospects for the region are brighter in 2021, with growth expected to be 7.9 percent in China and 5.1 percent in the rest of the region, based on the assumption of continued recovery and normalisation of activity in major economies, linked to the possible arrival of a vaccine.
However, output is projected to remain well below pre-pandemic projections for the next two years. The outlook is particularly dire for some highly exposed Pacific island countries where output is projected to remain about 10 percent below pre-crisis levels through 2021.
Poverty in the region is projected to increase for the first time in 20 years. As many as 38 million people are expected to remain in, or be pushed back into, poverty as a result of the pandemic (based on the upper-middle income poverty line of $5.50 a day).
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