World Bank estimates China growth +2%
The World Bank has released their latest Asia Pacific Economic Update for October 2020, which shows the strong economic and social impact of COVID-19 across the Far East region.
According to the report's data, regional growth in 2020 will be 0.9%: this is the lowest in 50 years and needs to be carefully considered; while China forecasts speak of growth of about 2% (improving from the 1% estimated in June), the rest of the region will enter recession, with a contraction of about 3.5%.
The only economies in the region besides China which will achieve growth are Vietnam (2.8%) and Myanmar, whereas the Pacific Islands, especially Fiji, will suffer a heavy backlash.
There has been a contraction in the level of economic and industrial activity with a drastic reduction in the volume of trade and international travel throughout the region, particularly affecting countries where tourism is an important source of income. In addition, the poorest countries, with a lower infrastructure budget and with a low level of social protection for their inhabitants, have been severely affected with a consequent increase in 2020 of the population below the poverty line of more than 38 million (corresponding to an income of less than 5.5 dollars per day). Among the most affected are Palau, Micronesia and Marshall Islands, which are micro-states in the American sphere of influence.
For 2021, the World Bank's estimates are positive for the whole region: Beijing's expected growth for next year is 7.9%, while the overall development of the other economies in the region will rebound to 5.1%. Trade will increase as economic activities continue to reopen, although the recovery of tourist flows may take longer.
Malaysia (6.3%), Myanmar (5.9%), Mongolia (5.6%) Philippines (5.3%) China and Vietnam are all forecasted to grow in 2021.
According to World Bank's analysis, Beijing has controlled the emergency, with a focus on the domestic market and the revival of exports; a strategy that Xi Jinping has called dual circulation: global development and increased domestic consumption.