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Seminar on “Building Capacity and Connectivity for the New Economy in East-Asia”

Tuesday, 28 May 2019 – The economic prospects for Southeast Asia and East Asia was the focus of the seminar which was co-organised by the Regional Economic Studies Programme at the ISEAS - Yusof Ishak Institute and the ASEAN +3 Macroeconomic Research Office (AMRO).

In the seminar, Dr Hoe Ee Khor, Chief Economist of AMRO, presented some of the key elements from AMRO’s Regional Economic Outlook (AREO) 2019 Report. Dr Khor’s presentation focused on the key factors affecting the economic prospects of the region next year. His presentation also covered the multiple challenges related to strengthening the collective development capacity and cross-border connectivity in the region.

Dr Hoe Ee Khor speaking about key factors affecting the economic prospects of the region. (Credit: ISEAS - Yusof Ishak Institute)

There were 2 main focal points for the talk, the first being the near-term macroeconomic prospects and challenges for the region. According to Mr Khor, the baseline regional growth in 2019-20 is likely to remain steady with low inflation, and the outlook for domestic demand is expected to be stable. However, regional exports have contracted in the first quarter of 2019 and export growth has turned sharply negative across an array of products. The speaker further focused on the impact of slow global growth on the Singapore economy, as more than 60% of the Singapore GDP is derived from external demand. He concluded the first part of the seminar by suggesting an appropriate policy mix with some recalibration to support growth.

The second part of the seminar focused on longer term structural shifts, more specifically on how to build capacity and connectivity for the new economy. Dr Khor suggested several different ways of strengthening the economy in the long run. Firstly by using technology as a growth enabler. Secondly by catering to the new demands created by the maturing population and rising middle class. Thirdly by driving regional demand and rebalance growth. Lastly by redressing the funding gap in CLMV countries.

Mr Khor ended the second part of the seminar by expressing the idea that hard infrastructure is indispensable for development, but soft infrastructure such as cross-country connectivity is also integral in unleashing the growth potential of the region and facilitating its transition to the new economy. Countries can leverage on regional initiatives, which aims to advance economic and financial cooperation, to bridge the gap between their current states and their future potential.

From left to right: Dr Siwage Dharma Negara, Dr Cassey Lee, Dr Hoe Ee Khor and Dr Chua Hak Bin (Credit: ISEAS - Yusof Ishak Institute)

The seminar ended with comments from two invited discussants namely, Dr Siwage Dharma Negara, Senior Fellow at ISEAS - Yusof Ishak Institute and Dr Chua Hak Bin, Senior Economist with Maybank Kim Eng. Dr Negara highlighted the importance of non-tariff issues and “technology war” in the on-going trade conflict between the US and China. Dr Chua shared his views on the impacts of the US-China trade conflict on countries in the region and the issue of currency manipulation.

Some of the audience at the seminar (Credit: ISEAS - Yusof Ishak Institute)