JAKARTA (Reuters) – Southeast Asia is on the brink of a “socio-economic crisis” brought on by the COVID-19 pandemic that could reverse decades of poverty reduction, the United Nations has cautioned.
” The crisis threatens to damage the incomes of Southeast Asia’s 218 million informal workers,” a U.N. policy quick released on Thursday stated.
” Without alternative earnings, official social protection systems or savings to buffer these shocks, employees and their households will be pressed into hardship, reversing years of hardship decrease.”
The region-wide economy was expected to contract by 0.4 per cent in 2020, it said, while remittances from Southeast Asians working abroad were most likely to fall by 13 percent or $10 billion.
The paper advised countries to repair “financial termites”: budget-sapping problems like tax evasion, transfer pricing and nonrenewable fuel source aids so they can deliver large stimulus bundles to assist susceptible populations and enhance their economies.
Existing low oil prices provided an ideal chance to reverse nonrenewable fuel source aids, it added.
In Indonesia, the region’s most populated country, fossil fuel subsidies in 2020 will exceed its whole COVID-19 social help and stimulus measures, the U.N. report stated.
Along with enhancing social welfare payments, Southeast Asian nations need to prioritise greater health costs, said Armida Salsiah Alisjahbana, head of the U.N. Economic and Social Commission for Asia and the Pacific.
6 of the 11 nations in the area – including its two greatest nations, Indonesia and the Philippines – got the lowest rating for health spending on the U.N.’s five-tier human development index. Three others were on the second-lowest tier and the staying two were on the middle tier.
The report covered the Philippines, Vietnam, Laos, Cambodia, Thailand, Brunei, Malaysia, Myanmar, Singapore, Indonesia and Timore-Leste.
Reporting by Tom Allard; Modifying by Raju Gopalakrishnan