Amid The Crisis

Amid The Crisis: The Danger Of Recession Looms Over The Asian Economies

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Key Highlight

  • Gross domestic product highlights the health of the economies.
  • Philippines GDP is affected by the In 2021, GDP is forecast to grow by 6% to 7% 2021. It is down from a previous estimate of 6.5 percent to 7.5 percent.
  • The IMF highlighted that the ASEAN-5 (Indonesia, Malaysia, Philippines, Thailand, and Vietnam) rose at -0.6 percent in 2020.

Gross domestic products

The total monetary or market value of all finished goods and services produced within a country’s borders in a given time span is known as GDP. It is a detailed scorecard of a country’s economic health as it is a general measure of overall domestic output. Both private and public consumption, government outlays, expenditures, and the international balance of trade are factored into a country’s GDP. The value of exports is applied to the value of imports, and the value of imports is subtracted.

What GDP of a country highlights?

GDP is important for economy. It provides details on the size and performance of an economy. The rate of increase in real GDP is often used as a gauge of the economy’s overall health. A rise in real GDP is viewed as an indication that the economy is doing well in general. As real GDP grows rapidly, employers are more likely to recruit additional employees for their factories. It improves the standard of living of society. GDP measures whether the economy is growing by producing more goods and services, or shrinking by producing fewer.

Pandemic has affected the GDP of countries

The Philippine government lowered its economic forecast for this year 2021 and next year 2022. This is due to increase in coronavirus cases creating a challenge to the country’s recovery. GDP is expected to rise 6% to 7% this year 2021. It is down from a previous forecast of 6.5 percent -7.5 percent in the Philippines. The growth forecast for 2022 has been lowered to 7% -9 percent, down from 8% -10 percent previously. According to a recent Bloomberg News poll of 33 economists, the Philippine economy will grow 5.5 percent in 2021, 6.5 percent in 2022, and 6.1 percent in 2023.

The downgrade comes after the Philippines’ first-quarter GDP contracted more than predicted, confirming the country’s position as one of Asia’s recovery laggards. Tighter restrictions in the capital region and neighboring provinces. This resulted in the closure of companies and the loss of employment.

Southeast Asia’s Economies facing a downfall

Southeast Asian economies are suffering greatly as a result of the global economic downturn brought on by the pandemic’s spread. The economic effect would be massive compare to the Asian Financial Crisis of 1997-98. The IMF forecasts -0.6 percent growth for the ASEAN-5 (Indonesia, Malaysia, Philippines, Thailand, and Vietnam) in 2020, down from its previous estimate of +4.8 percent.

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West has been driving the business world owing to its developed economies. The leading part of the world is straining to sustain its dominance. However, the other parts of the world, especially Asia Pacific region have been displaying escalating growth in terms of business and technological advancements.

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