2019 sees a slight slowdown as domestic and external events continue to play out from 2018, says Prof Joe Choo.
Southeast Asia consists of 11 countries squeezed between the Indian Ocean and the Pacific Ocean, namely Brunei, Cambodia, East Timor, Indonesia, Laos, Malaysia, Myanmar, Philippines, Singapore, Thailand and Vietnam. Around 620 million inhabitants make Southeast Asia one of the most populated regions in the world.
The global wave of policy tightening and domestic politics in some countries are weighing on growth prospects for the region. Policy makers are rewriting economic strategies as volatility surges, in some cases putting greater emphasis on currency stability or even structural changes. With trade war risks now materialising, this suggests stronger headwinds for exports.
Could the election uncertainty in Indonesia and Thailand, as well as questions around the new Malaysian government’s commitment to fiscal consolidation, add to investors’ angst in the region?
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According to reports, the Internet economy in Southeast Asia hit an inflection point in 2018 and is expected to hit US$72 billion in 2018 alone, thanks to the millions of mobile internet users worldwide, as well as industries like e-commerce, online media, online travel and ride-sharing. These industries are growing at never seen before rates.
In 2019, industries related to Wood (healthcare, education, creative industries such as advertising and design; property development, fashion, retail business, etc) and Fire (IT, oil and gas, telecommunication, digital, chemical based, electronic, electrical, etc) shall have better performance in this region.
There will be plenty of financial issues in the first two lunar months of 2019, so policy makers of the countries in this region have to be firm and not be misled by corrupt practices.
Economies in the more developed countries will be burdened by external issues so the governments of these countries have to be patient to protect its own interests. Nevertheless, these countries will still be able to perform well in 2019.
POWER PLAY
Southeast Asia has a long history of important security and economic ties to the United States. Yet the US has neglected the area and for almost two decades despite its view that it is a region that could tip the overall balance power in East Asia if its enormous resources fell under the control of a hostile power.
Despite its recent failure to entice Japan and Philippines to join its freedom of navigation operations in the South China Sea against China’s claim; rejection from Indonesia for the US’ ‘power projection’; Thailand leaning towards China and a brittle relationship with the Malaysian new government, the US will keep trying to strengthen its presence in this region in 2019 through various channels, according to the Gua number.
The overall SEA economy will have an upswing in lunar months 1, 6, 8 and 10, these are the better period for short term financial investors to make some gains.
Indonesia is constantly at risk of earthquakes, volcanic eruptions, floods and tsunamis. Located in the Pacific Ring of fire, there is at least one significant volcanic eruption and a major earthquake in the country every year. From the reflection of the Gua, there is another round of tsunami or water-related natural disaster in 2019 especially in lunar months 4 and 9.
The first two lunar months will see the right amount of rain falling at times suitable for the farming industry. The dry spell that will happen in subsequent months will not have any negative effect on the farming industry due to the sufficient rain earlier on.
In a nutshell, this region is still performing well yet not as spectacular as 2018.
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