Delta variant poses economic growth in East Asia and Pacific region: World Bank
Delta variant poses economic growth in East Asia and Pacific region: World Bank
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According to World Bank's newly released East Asia and Pacific Fall 2021 Economic Update, the East Asia and Pacific region's revival has been challenged by the spread of the Covid Delta variant calling for a comprehensive strategy to contain the virus spread and boost inclusive growth. Economic activity began to slow down in the second quarter of 2021, and growth forecasts have been downgraded for most countries in the region

"Whereas in 2020 the region contained Covid-19 while other regions of the world struggled, the rise in Covid-19 cases in 2021 has decreased growth prospects for 2021," as per reports.

While China's economy is projected to expand by 8.5 per cent, up 0.4 percentage point from April projection, the rest of the region is forecast to grow at 2.5 per cent, 1.9 percentage points less than forecast in April, the report showed.

Noting that there is variation across countries, Aaditya Mattoo, chief economist for East Asia and the Pacific at the World Bank, said that some countries like China have been relatively successful in at least keeping this virus at bay, but other countries which had done well previously, especially like Vietnam and Malaysia, are now battling to contain it and are suffering a "significant" contraction in economic activity.

Others like the Philippines and Indonesia had always struggled and their struggles have been "worse," so they are also seeing a contraction in economic activity and forecasts for them are less promising than before. Employment rates and labour force participation have declined, and as many as 24 million people in the region will not be able to escape poverty in 2021, the report noted, warning that the scars of the pandemic are likely to dampen long-term economic growth.

 

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