The COVID-19 pandemic may cost the Asia-Pacific region 0.8 percent of the gross domestic product, an estimated 172 billion U.S. dollars due to a massive drop in global demand for their exports alone, said a report issued by the UN Economic and Social Commission for Asia and the Pacific (ESCAP) on Wednesday.
According to the Economic and Social Survey of Asia and the Pacific report, the drop in demand for goods will come from Asia-Pacific's major trading partners, including the United States and the European Union, both regions severely hit by the COVID-19 outbreak.
"Weakened demand from these markets could impair the region's trade significantly ... Preliminary estimates by ESCAP suggest that the region's GDP could experience declines of 0.6-0.8 percent (valued at 132 billion U.S. dollars to 172 billion U.S. dollars) as a direct result of the COVID-19 pandemic through trade links alone," the report said.
Meanwhile, Vietnam, Mongolia, Cambodia and Singapore are countries most impacted by the decline in demand as they rely heavily on trade with the pandemic-hit countries, according to the UN commission.
Meanwhile, the UNESCAP's report, "Economic and Social Survey of Asia and the Pacific 2020," estimates that Asia-Pacific developing countries should increase health emergency spending by 880 million U.S. dollars per year.
The report also calls on Asia-Pacific countries to consider establishing a regional fund to respond to future health emergencies.
"Policymakers should maintain accommodative macroeconomic policies to sustain the economic health of the region," the report suggested, "Fiscal and monetary policies should be focused on supporting affected enterprises and households and preventing economic contagion."
