Asia Pacific heading towards uneven recovery amid lurking risks, World Bank says
One year on from the start of the pandemic, the Asia Pacific region's economy is still facing multiple risks, not least from an uneven recovery among countries and the possibility that new virus strains might appear, the World Bank said.
Nevertheless, in its April update for the region, the multilateral lender said the region's growth wasn't knocked completely off course, growing by 1.2% in 2020, whereas in the rest of the world it had shrunk by 4.0%.
China and Vietnam fared best, thanks to their exposure to the global trade in goods, which resulted in V-shaped recoveries.
Output in both countries surpassed its pre-Covid-19 levels in 2020, while in the four other major regional economies it was still about 5% beneath its pre-pandemic level.
The gap among the latter was large as well, ranging from 2.2% below pre-pandemic levels for Indonesia but 8.4% below in the case of the Philippines.
Particularly hard-hit across the region was the services sector, due to the lockdowns brought on by Covid-19, with tourism-dependent economies faring especially poorly.
Output in the small island economies such as Fiji, Palau and Vanuatu was still languishing about 10% below pre-pandemic levels.
And "due to the economic distress, poverty in the region stopped declining for the first time in 20 years and 32m people were prevented from escaping poverty," the Washington-based lender pointed out.
The pattern of growth was expected to be much the same going forwards, with Chinese and Vietnamese gross domestic product seen expanding by 8.1% and 6.6% in 2021, respectively.
Elsewhere in the region, growth in 2021 was expected to print at "only" 4.1% with output not seen recovering its pre-pandemic level until 2022.
In tourism-dependent island economies the recovery was expected to be "particularly protracted" with growth set to remain in the red in approximately half the countries - even though they had largely been spared by the pandemic.
Global growth experienced its deepest global recession since between the two World Wars and the Great Depression in 2020.