[PREMIUM] Country Updates: 1-14 April 2021

Myanmar

Violence and bloodshed continue as civilian death toll exceeds 700 (12 April)

More than 700 civilians have been killed including 50 children as of 12 April, according to advocacy group Assistance Association for Political Prisoners (AAPP). Myanmar’s military is resorting to increasing levels of violence to maintain its grip on power in the wake of its intervention on February 1. In a brutal crackdown on a protest in the city of Bago on Friday (9 April), more than 80 people were killed by Myanmar security forces. Witnesses say military forces fired on protesters with assault rifles, rocket-propelled grenades (RPGs), and hand grenades.

Fears that the country may spiral into broader civil conflict have emerged, with clashes between ethnic armed rebel groups and state security forces escalating in recent weeks. Unrest erupted over the weekend in northern Shan State, as Ta’ang National Liberation Army (TNLA), an ethnic rebel group, mounted an attack on a police base and killed more than a dozen police officers. The military retaliated with air strikes, killing at least one rebel soldier.The Karen National Union (KNU) and the Kachin Independence Army (KIA) have also stepped up attacks on military and police in recent weeks, and retaliatory air strikes by the military have displaced more than 10,000 civilians in Karen state.

Sources: BBC; Nikkei Asia; CNN; Straits Times

Myanmar’s crumbling economy and currency crisis (12 April)

The World Bank projects that Myanmar’s economy will shrink 10% in 2021, by far the worst in Asia as other countries rebound. Fitch Solutions, expects the situation to worsen and revised its forecast for the financial year to a 20% contraction, from an earlier forecast of 2% growth, predicting drastic declines in every measure, from exports and investment to general consumption, tax revenues and government spending on COVID-19 relief.

Myanmar’s currency has also been depreciating since the intervention on 1 February, resulting in an increase in the price of imported goods. Notably, the value of the kyat against the US dollar dropped 14% in the two months following the coup. Given that Myanmar’s industrial sector has never really nurtured exporters, and with Myanmar’s reliance on imports for many items such as processed food, daily use products and gasoline, Myanmar’s trade deficit will continue to grow. This, coupled with shrinking foreign investment could result in a further depreciation of the currency.

Sources: Nikkei (1), Nikkei (2), Straits Times

Thailand

Thailand reports record COVID-19 cases ahead of Songkran holiday (12 April)

On 12 April, Thailand reported 985 new COVID-19 cases, a record daily jump for a second day in a row. The cases include the highly transmissible B117 variant first identified in Britain. All but five new cases were local transmissions. This marks the country’s third wave of infections.

The outbreak comes ahead of the country’s major national Songkran holidays and authorities have urged people to avoid unnecessary travel and reduce gatherings. Night spots such as pubs and karaoke bars in Bangkok and 40 provinces have also been ordered to close until 23 April, in hopes that this measure will slow down infection rates by a third in the next month. At least 3,000 extra beds have been prepared in ten new field hospitals near Bangkok and more will be set up around other major population centers, including Chiang Mai, Chonburi and Hua Hin.

Sources: CNA, Nikkei

Thailand considers visa rule overhaul to lure investment, tourists (12 April)

Foreign direct investment in Thailand has fallen more than 50% in the past five years as investors grew wary about the country’s political uncertainties, aging society and labour shortage. With COVID-19, tourism, a key sector of Thailand’s economy, also plunged to its lowest level in 12 years. The Bank of Thailand has reported that GDP growth is not expected to return to pre-pandemic levels until Q3 of 2022.

In hopes of attracting expats, retirees and pensioners to stay in the country long-term so as to boost the overall economy, the Thai government has announced that a detailed framework to promote investment and tourism will be proposed within a month. Plans include improving regulations on immigration, visa applications and work permits for foreign experts, as well as inducements for foreign investors such as corporate income-tax cuts, relaxed property-holding rules and incentives for retirees and startup companies.

Sources: Business Times, Nikkei

Indonesia

Indonesia keeps Sinovac, says satisfied with effectiveness of vaccine (12 April)

Indonesia will keep using the vaccines developed by China’s Sinovac Biotech Ltd and is satisfied with the effectiveness of the vaccine it is using. The statement from the government came as concern is mounting around the efficacy of China’s Sinovac vaccine, after the head of the Chinese Center for Disease Control and Prevention acknowledged that current vaccines offer low protection against the virus. The Indonesian government cited WHO endorsement of the vaccine as being safe and having sufficient efficacy rates. Clinical trial results in Indonesia showed the Sinovac vaccine was 65% effective.

Indonesia, the worst infected country in Southeast Asia, is counting heavily on the shots to inoculate its population to achieve herd immunity within a year. It is in talks with China to secure as many as 100 million COVID-19 vaccine doses to plug a gap in deliveries after delays in arrivals of AstraZeneca shots.

Sources: CNA; Business Times; Reuters

IMF downgrades Indonesia’s 2021 GDP growth outlook (9 April)

The International Monetary Fund has downgraded its forecast for Indonesia’s GDP this year due to setbacks faced in the country’s mass vaccination campaign. In the IMF’s April update, Indonesia’s GDP projection was lowered by 0.5% to 4.3%.  This is lower than the Indonesian government’s estimates, which is expecting growth between 4.5% and 5.3%. The IMF is the only international economic organisation to lower its forecast for Indonesia’s growth outlook in 2021, thus far. The World Bank has maintained its growth forecast at 4.4%, and the Organization for Economic Cooperation and Development (OECD) raised its forecast by 0.9% to 4.9%.

Sources: Jakarta Post; Jakarta Globe

Malaysia

Reopening of the border to be discussed during Malaysia-Singapore leaders’ meeting (13 April)

The reopening of the Malaysia-Singapore border is expected to be on the agenda during the meeting between Singapore’s Prime Minister, Lee Hsien Loong, and Malaysia’s Prime Minister Muhyiddin Yassin. Malaysia’s Foreign Minister, Hishammuddin Hussein, said he would “make sure” the reopening of the border is discussed during the meeting. Hishammuddin said the issue was discussed during his meeting with Singapore’s Foreign Minister, Vivian Balakrishnan. In March, both countries said they would work towards recognising each other’s COVID-19 vaccine certifications and are committed to “progressively restore” cross-border travel for other groups of travellers.

Sources:CNA; Straits Times

Muhyiddin: Government does not have much money left after COVID-19 expenditure (12 April)

Prime Minister Muhyiddin Yassin reportedly said that the government’s funds are limited due to the rollout of various stimulus packages to support the Malaysian economy. “What I am trying to say here is, we don’t have much money left. We don’t have as much [money] as before, because the most important thing for us is to ensure our livelihood; we should be able to manage ourselves better,” Muhyiddin said. He has emphasised the government’s large expenditure as necessary as it is “important to save lives and the national economy.”

On 22 March, Muhyiddin announced a new RM20 billion economic stimulus package, the “Strategic Programme to Empower the People and Economy” (Pemerkasa). The package is the sixth package introduced since the start of the pandemic. The programme comprises 20 strategic initiatives to boost economic growth, support business and extend targeted assistance to the people and affected sectors. Meanwhile, in its April update, the IMF maintains its forecast for Malaysia’s 2021 GDP at 6.5%.

Sources: MalayMail; CNA; NST

Vietnam

Vietnam confirms new leadership (5 April)

Vietnam’s National Assembly officially elected Mr. Pham Minh Chinh as the Prime Minister on 5 April. Former Prime Minister Mr. Nguyen Xuan Phuc became the new president and Hanoi’s Communist Party chief Mr. Vuong Dinh Hue was elected Chair of the Vietnam National Assembly. Together with Mr. Nguyen Phu Trong who was elected to a third term as General Secretary of the Communist Party, they make up the “four pillars” of Vietnam’s top leadership that will lead the country for the next five years.

There were no surprises in the new leadership although analysts have noted southern politicians have been completely excluded this time round. Trong is a northerner while Chinh, Phuc and Hue all come from the central region.

PM Chinh was the former Secretary of the Quang Ninh Provincial Party Committee and was lauded for improving the overall management and administrative structures in the province. He brought up Quang Ninh’s competitive index ranking to number three among all the provinces. The prime minister’s role in Vietnam is usually known for driving the economy and being the point person for foreign diplomacy. Chinh said his administration will “drastically and persistently push for anti-corruption” measures while “continuing with economic reforms, developing the digital economy and focusing on solving difficulties for industries and businesses.”

Sources: Nikkei Asian Review, Bloomberg, Vietnam News