In 2021, the APEC economy is expected to rise by 6%.
In anticipation of the unwinding of fiscal and monetary assistance measures, the Asia-Pacific Economic Cooperation (APEC) region’s GDP is predicted to grow by 6% this year and 4.9 percent in 2022.
This pattern is supported by a recently released report on Asia-Pacific economic trends.
According to the most recent APEC Regional Trends Analysis (ARTA), the Asia-Pacific region grew by 8% in the first half of 2021, after contracting by 3.7 percent in the first half of 2020, according to a written statement released by the Policy Support Unit and received here on Monday.
However, growth amongst member nations continues to diverge, and there are still significant uncertainties.
Due to the combined effect of a low comparison point following a significant economic downturn a year ago and a rebound in economic activity, growth in the volume and value of merchandise trade surged by double digits in the first half of this year.
Pharmaceuticals, telecommunications devices, and computers were all in high demand as the coronavirus disease 2019 (Covid-19) spread.
Greenfield investments to the APEC region, on the other hand, have plummeted to their lowest level in in two decades, according to the study.
This is especially concerning given the critical role they play in enhancing domestic technology and skills, as well as infrastructure development and productivity.
Inflationary pressures are another source of concern. After averaging 1.5 percent in 2020, the region’s inflation rate increased to 2.6 percent in the first nine months of 2021.
If left unchecked, the research warns, a rising trend in inflation could jeopardize economic recovery.
“APEC, like the rest of the world, is in new territory,” said Denis Hew, director of the APEC Policy Support Unit, which authored the research.
“The pandemic has taught us many painful lessons, the most important of which is that economic, trade, and health policies are all interconnected –and that good policies matter,” Hew continued. “To avoid a two-track recovery, unequal access to immunizations must be addressed immediately.”
“APEC economies could also consider allowing a progressive and steady economic reopening to restore viable sectors like travel and tourism, renew manufacturing industries, and herald the creation of new employment, markets, and businesses that could prove more sustainable and profitable,” he said.
Climate change poses an existential threat to the area and civilization as a whole, as it will disrupt the financial systems, supply chains, and consumer behavior of APEC economies.
“Addressing climate change is not only the domain of scientists, but also of policymakers, who have the ability to change incentive structures and laws,” said Emmanuel San Andres, an analyst at the APEC Policy Support Unit and co-author of the research.
“Vulnerable populations, such as the poor and indigenous peoples, are disproportionately affected by climate change, despite contributing the least to it,” he added.
Even in the best-case scenario, where climate change is controlled to or below 2.0 degrees Celsius, APEC can expect GDP losses of up to 11.3 percent by 2050, according to the analysis.
San Andres stated, “We need to improve global and regional collaboration and focus on actions, not only commitments on climate change.”
“Tackling climate change requires a holistic strategy across a range of areas and challenges, including ensuring that green policies are implemented in such a way that their negative side effects are addressed,” he added.
The report will serve to set the tone for this week’s APEC Ministerial Meeting and APEC Economic Leaders’ Meeting.
The APEC Policy Support Unit has released a graphical picture of the region’s economic, trade, and investment performance.
The APEC in Charts 2021 has a section on the Covid-19 pandemic, which includes the number of cases and deaths, immunization status, and the top five most sold Covid-19-related products in the region.