A street in Bangkok, Thailand. (Photo: AP)The newspaper writes that whileanalysts have downplayed the Association of Southeast Asian Nations (ASEAN)’s economic exposure to Russia and Ukraine, theycaution that a protracted conflict that hurts the European Union (EU) will havespillover effects, hitting everything from trade to tourism.
Malaysia's Maybank this month warnedof "collateral damage on ASEAN" from the conflict and resultingsanctions against Russia.
"A broader Europe downturn will have larger knock-oneffects on ASEAN's exports, foreign direct investment and growth,"Maybank's report said, pointing out that the EU accounts for 9percent of ASEAN's exports and 11 percent of the bloc’s total foreign directinvestment.
Financial services firm MorganStanley Asia this month downgraded its growth projections for Singapore to 3.7percent from 4.8 percent, for Thailand to 3.3 percent from 4.3 percent, and forthe Philippines to 7 percent from 7.5 percent.
Meanwhile, Maybank noted that before thepandemic, Europeans accounted for the largest share of visitors to Thailand, at17 percent. They also made up 13 percent of Indonesia's arrivals and 11 percentof Singapore's. But a worsening European economy and inflationary pressurecould dampen travel demand.
Nikkei Asia cited experts as sayingthat as the upward pressure on energy and food prices increases, it will put adamper on ASEAN economic rebounds.
Credit rating firm Moody'ssaid inflationary pressure is likely to build faster in economies where fueland electricity prices have a heavier weighting in consumption baskets, orwhere imported fuel is predominant. This will put ASEAN governments in a tightspot, after two years of pandemic pain./.
VNA
