On June 10, 2020, students at an Islamic junior high school in Banda Aceh sit beside a painting representing the Indonesian flag while wearing face masks because of the Covid-19 outbreak. Getty Images | Chaideer Mahyuddin | AFP Singapore (Singapore) — Covid-19 infections are on the rise in several key Southeast Asian economies, prompting Goldman Sachs to lower its economic predictions for the region in 2021. In recent weeks, the rise of the more transmissible delta variety has pushed daily Covid cases in Indonesia, Malaysia, and Thailand to new highs. According to Goldman economists, this has resulted in more harsh limitations in Indonesia and Thailand, as well as the extension of restrictions in Malaysia. The outbreak of the coronavirus in the Philippines has made relaxing of social-discrimination measures “less plausible” this year, according to the economists. The analysts believe that renewed viral outbreaks and tighter restrictions will have a “much greater” impact on growth in the second half of 2021 than previously predicted. Goldman cut its growth predictions for Indonesia, Malaysia, and the Philippines by more than 100 basis points. The bank took a lower cut in Singapore and Thailand. The significant rise in Covid infections in Southeast Asia has coincided with a lag in immunization development in the region, which, with the exception of Singapore, has lagged behind several countries such as the United States and the United Kingdom. According to the most recent data published by online statistics portal Our World in Data, Singapore has one of the quickest vaccination rates in the world, with almost 41% of its population fully immunized. However, the rest of the region moves at a far slower pace: According to the data, Malaysia has fully immunized 12.4 percent of its population, while Indonesia has fully vaccinated 5.7 percent of its population. In Thailand and the Philippines, only about 5% of the population has been fully immunize against Covid. Singapore began to loosen social-distancing regulations last month after tightening them in early May. According to Goldman Sachs experts, Malaysia will be the next Southeast Asian economy to follow suit in the fourth quarter of 2022, while the rest of the region will do so in the first half of 2022. Stronger global growth, according to Goldman, will benefit trade-oriented economies like Singapore and Malaysia the most. Malaysia, which is a net commodity exporter, will benefit from rising commodity prices as well, according to the bank. Meanwhile, “larger exposures to sectors such as tourism, lower exposures to global trade, and limited policy buffers are likely to push sequential growth lower in Indonesia and Thailand, and keep the sequential growth rebound in the Philippines more muted than our prior expectations,” according to the report./n
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