COVID-19 Outbreak: Singapore Economy To Contract 0.6% In Q1

Economists expect the effects of the coronavirus outbreak to reverberate beyond China, with Singapore being the worst hit.

A major trade partner with China, the city-state’s economy is expected to contract 0.6% in the first quarter of 2020 – a first since the 2009 recession following the global financial crisis.

Aside from Singapore, forecast from economists polled by Reuters showed that South Korea, Australia, Thailand and Taiwan are also expected to register their worst performance in years in Q1 2020.

South Korea was forecasted to grow 2.1% (down by 0.4% from the January Reuters poll), while Thailand and Taiwan are expected to expand by 0.2% and 1.3% respectively. Australia’s economy is predicted to grind to a halt, ending the near three-decade growth streak that began in 1991.

Meanwhile, Indonesia was expected to see the least impact, with the economy forecasted to grow 4.7% this year.

“The impact of the coronavirus on economies in Asia is potentially huge, as tourism in the region takes a beating. From deserted hotels to empty airports, the impact of this little scrap of protein and lipid on economies in the region is potentially enormous,” said Robert Carnell, Chief Economist and Head of Research for Asia-Pacific at ING in Singapore.

A similar poll published over a week ago found that the Chinese economy will expand at its slowest pace in the present quarter since the financial crisis. In a worst-case scenario, economists anticipate the Chinese economy to grow 3.5% or almost half of the 6% reported in the last quarter of 2019.

Nonetheless, most major Asian economies polled are expected to bounce back in the second quarter, albeit growth for this year will likely be lower than forecasted last month, reported Reuters.

Ref: Property Report