Joseph Incalcaterra, chief economist for ASEAN at the HSBC Global Research has hailed Vietnam’s handling of the virus, as saying that its response to the pandemic allowed the country to maintain its reputation as a “very good destination” for foreign direct investment.
Singapore and Vietnam have been successful in controlling the coronavirus in 2020 and are likely to keep the situation contained in 2021, Incalcaterra said on an article recently published on www.dailymirror.uk.
“Those two countries probably stand out most positively”, he said when responding to a question on which Southeast Asian countries will be able to keep COVID under control and smoothly roll out vaccines.
He praised Vietnam’s handling of the virus, and said its response to the pandemic allowed the country to maintain its reputation as a “very good destination” for foreign direct investment.
The country has been seen as an alternative manufacturing hub for companies that want to move out of China. “We saw that actually FDI this year remains very resilient into Vietnam,” he said.
Overall, however, Southeast Asia may not benefit from a vaccine in the near future, given the logistical difficulties in rural parts of the region. “It’s very unlikely that we see a significant share of the population inoculated in 2021,” he said.
Incalcaterra said Southeast Asia has been “hit very hard” this year. “From a domestic perspective, the traditional consumer engine of these economies is no longer intact.”
“We really don’t have great visibility on the short-term recovery, given how deep the damage is,” he added.
Countries had been pursuing “very ambitious infrastructure programs” to make the region a “reliable manufacturing production base.” These projects were stalled because of the coronavirus.
“Until the virus is under control … we’re not going to see this investment engine regain its momentum,” he said. “That’s, I think, the biggest short-term hindrance to growth in Southeast Asia.”VOV