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The Asian Development Bank said Thursday that the Philippine economy is likely to contract 8.5 percent this year due to the prolonged impact of the coronavirus pandemic. This latest projection was worse than the previous estimate of a 7.3 percent contraction announced by the bank in its Asian Development Outlook in September. He said the Philippines was expected to have the deepest contraction among Southeast Asian economies this year, and that Thailand was projected to register a 7.8 percent decline; Singapore, -6.2 percent; Malaysia, -6 percent; and Indonesia, -2.2. Vietnam alone is expected to grow this year at 2.3 percent. Southeast Asia is expected to contract 4.4 percent this year, more than the assumption of -3.8 percent made in September. The ADB said the Philippine economy was expected to recover and expand 6.5 percent in 2021, the same growth rate it announced in September. This will be the second fastest GDP growth next year among ASEAN economies, behind Malaysia’s 7 percent. “Economic growth in Southeast Asia remains under pressure as COVID-19 outbreaks and containment measures continue, particularly in Indonesia, Malaysia and the Philippines,” the ADB said in the report. “The growth forecast for the subregion for 2020 is revised down to -4.4 percent from -3.8 percent in September. The subregion’s outlook for 2021 has also been narrowed, and Southeast Asia is now expected to grow 5.2 percent next year compared to the 5.5 percent growth forecast in September, ”he said. Economic activity in developing Asia is forecast to contract by 0.4 percent this year, before rebounding to 6.8 percent in 2021 as the region moves toward recovering from the effects of the pandemic. coronavirus disease, the bank said. Most of the developing Asian subregions are expected to contract this year. East Asia is the exception, with an improved growth forecast of 1.6 percent for 2020 due to faster-than-expected recoveries in China and Taiwan. East Asia’s growth outlook for 2021 remains at 7.0 percent. South Asia’s GDP is forecast to contract by 6.1 percent in 2020, revised up from the 6.8 percent contraction forecast in September. Growth in South Asia is forecast to rebound to 7.2 percent in 2021. The World Bank also projected a deeper contraction in gross domestic product for the Philippines of 8.1 percent this year due to the pandemic. This projection was worse than its estimate of 6.9 percent made by the bank during October’s Philippine Economic Update. The Philippine economy contracted 10 percent in the first three quarters amid the pandemic.
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