No matter where we look across the globe, there doesn’t appear to be an economy that hasn’t been hit by the outbreak of COVID-19 in some way. With businesses across multiple markets affected in one way or another, how far does the economic pain stretch in Southeast Asia, and how does each country plan to begin its comeback?
Which industries are among the worst hit?
Due to the pandemic, the economic dip has been likened to be on par with the fallout of the 1997-98 Asian Financial Crises, or even greater. With some of the world’s largest factories hit, its easy to understand why the job market has become one of the worst effected areas in the Southeast Asian economy. In Laos for example, the economy has fallen silent. With factories shut, plants closured and employees laid off, its safe to say the Coronavirus has had an unprecedented impact.
It’s reported that in Cambodia, more than 5,000 textile workers have now become unemployed as a result of the factory closures, and Lao Airlines informed local media that it has laid off over 1,000 of its staff. As well as these large industries, it seems that the automotive sector has also been badly affected, with manufacturer Nissan having closed its factories in Japan. It joins the likes of Ford, Toyota and Honda who have all temporarily shut down production in Vietnam to protect their employees. However, despite the needed protection, it has put a large strain on the economy.
Not only do these closures affect the immediate economy of the Southeast Asian countries, it also has a butterfly effect on neighbouring countries and those further afield, who rely solely on exports from these nations.
Have regional currencies been affected?
To lessen the pain to citizens in their country, many governments across the globe have rolled out packages which help support families through these difficult times. Many of these include cash handouts, wage compensations and other forms of financial aid.
Recently Singapore announced a S$59.9 billion package, while Thailand came forward with a 1.9 trillion-baht package. Although the two are roughly equivalent, with the sheer amount of money that these and other countries are pledging to their nations, there’s no doubting that each currency will be affected in one way or another.
To monitor money, the best and most effective way of doing so is online. There are a number of platforms available that can accurately track the rise and fall of currency in real-time. It will not only give people an understanding of where their local currency stands in terms of depreciation and inflation, but it can also give insight into where things such as stocks and share might sit.
How do they expect to recover from such a fall?
With many countries all experiencing the same import and export issues, there’s no surprise that Southeast Asian countries are turning more towards domestic sales. “It is a lot better to sell domestic than export. The export market is doing very badly now,” one source with a Chinese independent refiner said.
Is the future of buying and selling across nations set to become a lot more domestic than it has been in generations? Do countries expect this to work in the long term? Or will we revert back to the old ways of importing and exporting goods halfway across the globe?