Kuala Lumpur, Malaysia (CU)_ Moody’s Analytics stated that Malaysia and Singapore are positioned to gain from global growth in 2022. The credit rating agency stated that apart from being the most aggressive in financial policy support for their economies in the past year, both countries were cautious about reopening their borders to visitors. A commentary note released by Moody’s Analytics said, “Malaysia is in the midst of an emergency order banning interstate travel”.
Moody’s Analytics pointed out the 2008-2009 global financial crisis and stated that China and its connections through supply chains in the Asia Pacific region (APAC) and the rest of the world can support Asia lead the economic recovery. It highlighted that China’s efforts on recovering the production side of the economy effectively allowed manufacturing to spark China’s recovery starting in the second quarter of 2020, and also lifted surrounding Asian economies when they relaxed several border restrictions.
It stated that Vietnam, Malaysia, Taiwan, Indonesia, Hong Kong, Japan, Thailand, and Singapore in terms of percentage saw double-digit growth in trade with China last year. It said, “Countries, including Vietnam, Malaysia, Taiwan and Indonesia, have benefitted from the carry condition of Chinaʼs growing trade demand”. It added, “However, demand for goods in Europe is at higher risk, at least in the near term”.
As China’s speed of recovery improved trade across APAC, the sustainability of regional export flows remains dependent on the collective effort to control the COVID-19 pandemic. It stated, “It should be noted that this trade alone is not enough to guarantee full economic recovery. Containment of COVID-19 also is a necessary condition, which neither Indonesia nor Malaysia have yet managed to achieve”. It added, “Indonesia, the Philippines and Malaysia continue to struggle and may require more fiscal support, since they also run risks of additional quarantines or movement controls in coming months”.
