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A multi-speed recovery, with China leading the way

Overview Economic activity is rebounding across the region, but the speed of the recovery varies significantly by country. Daily life in China, Vietnam and Taiwan has already returned largely to normal, thanks to their early success in containing the virus. These economies will be the first to recover. At the other end of the spectrum are Indonesia, the Philippines and most of South Asia, where the number of newly reported cases is still rising. These countries are trying to reopen their economies, which has led to an initial increase in activity. But social distancing will continue for much longer and recoveries are likely to be gradual. GDP in these places will be up to 8% lower at the end of 2022 than if the crisis hadn’t happened. Countries that are heavily dependent on tourism, most notably Thailand, will also struggle. In aggregate, we think GDP in Emerging Asia will contract by 2.5% this year, before rebounding by 10% in 2021.

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