Last year, Southeast Asia’s low vaccination rates and strict lockdowns reverberated across the world, mostly in the form of supply shortages. The region is a key manufacturing center for electronics and labor-intensive goods, and the disruptions—ranging from footwear and textiles from Vietnam and semiconductors from Malaysia—have been most acute in the United States. Given Southeast Asia’s crucial role in the global supply chain, its performance in 2022 is important for not just its 655 million people but for the entire world.
COVID-19 has hit the region hard: contact-based economies, especially tourism, account for a large share of GDP; governments have limited ability to provide financial support; and acquisition and distribution of vaccines has proved difficult. These limitations formed a perfect storm in the second half of 2021, when the Delta variant caused a spike of infections, and regional policymakers had to resort to lengthy lockdowns, which weakened the economy and disrupted tourism, manufacturing, and global supply chains. In the third quarter, economic output fell by 6.2 percent in Vietnam as its southern industrial centers were largely shut for months. In Malaysia, output dipped by 4.5 percent as industries ranging from semiconductors to palm oil halted under government restrictions. In Thailand, drops in domestic and tourism sectors prompted a 0.3 percent fall in output.
By Trinh Nguyen / carnegieendowment
The views and opinions expressed in this article are solely those of the author and do not necessarily reflect the position of AsiaWE Review.
