Asia’s “tiger economies” have stopped growling

Asia is “the epicentre” of global growth fears, says Eric Lam on Bloomberg. Long a “poster child” for pandemic management, the region’s low vaccination rates mean that the next few months will be bumpy. Seoul has imposed the strictest lockdown since the pandemic began to combat a spike in cases.

Tokyo has declared a state of emergency less than a fortnight before the Olympic Games begin. Less than 15% of the population in Taiwan, Indonesia and Thailand have received a first vaccine dose, while the roll-out in South Korea and Japan has lagged behind other developed economies.

Asian shares had their worst week since February last week, says Swati Pandey on Reuters. Last Friday, the MSCI Asia Pacific index briefly lost all of its gains so far this year before recovering slightly.

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China grew at a record annual rate of 18.3% in the first quarter of the year, but the economy is “widely expected to lose steam in the next six months amid sluggish demand, softer export momentum… and higher commodity prices”, say Orange Wang and Frank Tang in the South China Morning Post. The People’s Bank of China, the central bank, has announced that it will cut the reserve requirement ratio for banks, a measure that will inject about one trillion yuan (£112bn) of extra liquidity into the economy.

China’s rapid growth has obscured long-term trouble in some other parts of the region, says Jayati Ghosh for Project Syndicate. “This was supposed to be the Asian century”.

Yet growth in India, Indonesia, Malaysia and Thailand has disappointed over the past decade. India’s investment rate tumbled from 40% of GDP in 2010 to 30% in 2019, a worrying sign for the future. “Where have all the Asian tigers gone?”