Moody’s Investors Service on Tuesday downgraded this year’s GDP forecasts for 15 economies in the Asia-Pacific region following the recent coronavirus outbreak in China but left Cambodia’s forecast unchanged.
“The coronavirus outbreak adds to other pressures on growth in Asia Pacific, with the impact felt primarily through trade and tourism, and for some sectors also through supply-chain disruptions” the US rating agency said.
In a statement released in Singapore, Moody’s cut its China growth forecast from 5.8 percent to 5.2 percent to reflect a “severe but short-lived economic impact, with knock-on effects for economies across the region.”
Other economies with forecasts lowered by at least three-tenths of a percentage point were Australia, Fiji, Hong Kong, India, Laos, Macau, the Maldives, Mongolia, Papua New Guinea, Singapore, Solomon Islands, Taiwan, Thailand and Vietnam.
But Cambodia’s forecast for this year was unchanged at 5.4 percent for this year, down from an estimated 7.0 percent in 2019.
Other emerging economies with unchanged forecasts were Bangladesh, Indonesia, Malaysia, Pakistan, the Philippines and Sri Lanka.
Among the economies downgraded Tuesday, Macau and Hong Kong had the bleakest outlooks — GDP is forecast to contract 6.0 percent in Macau this year and 2.5 percent in Hong Kong.
“Our baseline assumption is that the economic effects of the coronavirus outbreak will continue for a number of weeks before tailing off and allowing normal economic activity to resume,” Moody’s senior vice president Christian de Guzman said.
The statement said reduced Chinese demand for Asian exports and supply chain disruptions “represent the two most direct transmission channels for slowing economic growth, although services trade adds a third channel.
“As such, goods and commodity exporters are most exposed to a protracted fall in Chinese demand, while tourism hubs that rely on Chinese visitors will also be vulnerable,” Moody’s said.