CARI Captures Issue 545: COVID-19 pandemic pushes 4.7 million more people into extreme poverty in 2021

ASEAN
COVID-19 pandemic pushes 4.7 million more people into extreme poverty in 2021
(17 March 2022) The COVID-19 pandemic pushed 4.7 million more people into extreme poverty – defined as those living on less than US$1.90 per day – in 2021 as compared to 2020, and erased another 9.3 million jobs across the region. This is according to a report recently released by the Asian Development Bank (ADB). The pandemic has impacted the region’s labor market, leading to widespread unemployment, worsening inequality, and rising poverty levels. Although the ADB projects growth of 5.1% in 2022 due to higher vaccination rates, it warned that the new Omicron variant could cut growth by as much as 0.8%. The ADB noted that the region’s crucial tourism sector will gradually begin to recover this year as borders begin to reopen. The ADB also called upon Southeast Asian governments to invest more into their healthcare systems to ensure future resilience. It predicted that the region’s economic growth could increase by 1.5% if health spending in the region reaches about 5% of GDP, compared with 3% in 2021.

MALAYSIA
Government allows Malaysians to make another withdrawal from Employees Provident Fund
(16 March 2022) The Malaysian government announced that they will allow Malaysians to make a withdrawal of up to MYR 10,000 (US$2,383.13) from their savings at the Employees Provident Fund (EPF), a state-owned pension fund which manages the pension savings of private workers in Malaysia. The government had previously allowed the withdrawal of EPF contributions through three schemes, namely i-Lestari, i-Sinar and i-Citra, which amounted to US$24 billion being withdrawn, involving 7.34 million contributors since the COVID-19 pandemic hit the country two years ago. The government stated that further details concerning the withdrawal will be revealed by the EPF in the near future, as well as the necessary measures to address the issue of declining EPF members’ retirement funds. Malaysia’s Finance Minister had recently revealed that the EPF’s recently announced dividend rate of 6.1% should have been higher at 6.7% if there had been no outflows of savings by its members. He also cautioned that the EPF may be forced to dispose of more of its overseas investments and halt domestic investments to fund these withdrawals.

SINGAPORE
Number of expatriate white-collar workers in Singapore fall to lowest number in more than a decade
(16 March 2022) The number of expatriate white-collar workers in Singapore fell to its lowest number in more than a decade in the year ending December 2021. According to the Ministry of Manpower, the number of Employment Pass holders – a type of visa issued to foreign professionals, managers and executives earning at least US$3,300 per month – fell by 9% to 161,700. That is the lowest number since 2010, when there were 143,300 in the country. This has been attributed to both concerns by local Singaporeans that foreigners are taking their jobs, as well as restrictions on travel due to the pandemic. There has also been a drop in the number of technicians and laborers in the construction sector, causing delays in housing projects and other building projects. The total number of foreign workers in the city-state stood at 1.2 million at the end of 2021, well below the 1.43 million that Singapore hosted in 2019.

INDONESIA  
Government removes export volume restrictions on palm oil products, raises export levy instead
(17 March 2022) The Indonesian government recently announced they will remove export volume restrictions on palm oil products and raise its export levy instead. This was a surprise policy U-turn by the government just a week after it had further tightened its export curbs. Under the so-called domestic market obligation (DMO), the government had required companies to sell 30% of their planned export volume of palm oil products domestically, up from 20% imposed in January 2022. This had been to ensure local supply amidst soaring cooking oil prices. The Indonesian Trade Minister had recently announced that the policy had resulted in supply scarcity, and that the DMO would be withdrawn. Instead, the government will raise the ceiling of palm export tax and levy, from a combined maximum of US$375 per tonne to between US$575 to US$675 per tonne. Global prices of crude palm oil, which Indonesians uses for cooking oil, have surged to historic highs in 2022, amid rising demand and weak output from top producers Indonesia and Malaysia, plus Indonesia’s export limits.

THAILAND, MALAYSIA   
Malaysia lifts ban on import of cattle and buffaloes from Thailand with immediate effect
(16 March 2022) On 16 March 2022, Malaysia lifted the ban on the import of cattle and buffaloes from Thailand with immediate effect. According to Malaysia’s Veterinary Services Department (DVS), the decision came following an agreement with the Thai Department of Livestock Development (DLD) on measures to control Lumpy Skin Disease (LSD). Malaysia had suspended the import of cattle and buffaloes from Thailand on 8 June 2021 after assessing the risk of LSD, which was reported to be contagious in more than 41 provinces in the country. The decision by DVS was made following several improvements in import rules and procedures, and also took into account mitigation measures that can be taken in Thailand to control the spread of LSD. The DVS stated it expects the supply of buffalo and cattle to remain sufficient ahead of the Hari Raya Aidilfitri celebration in May 2022.

THE PHILIPPINES
Authorities mull four-day working week to reduce fuel costs on Filipino businesses and workers  
(16 March 2022) In the face of rising energy costs, Filipino authorities have rejected calls by lawmakers and transport groups to suspend excise taxes on petroleum products, instead suggesting alternative solutions including more subsidies for affected sectors as well as a four-day working week. The government is expecting to collect US$2.5 billion in 2022 from excise taxes on fuel, and it is believed that suspending the excise tax would cut government revenue this year by 0.5% of GDP. A three-month wage subsidy has also been proposed by the labor department. The Finance Secretary also said that suspending the excise tax on fuel will increase this year’s deficit to 8.2% of GDP from a projected 7.7%, and the debt ratio to 61.4% of GDP from a 60.9% estimate.

VIET NAM
Coal-fired power plants in Viet Nam face shortage of coal supplies due to COVID-19 disruptions
(17 March 2022) Coal-fired power plants in Viet Nam are currently facing a shortage of coal supplies as COVID-19 impacted the operations of local miners, as well as due to the high global cost of importing the fuel. In February 2022, power plants operated by state utility EVN only received 69% of coal agreed in contracts with state-run miners Vinacomin and Dong Bac. Vinacomin stated that its operations had been impacted by a shortage of miners due to the COVID-19 pandemic. The ongoing war in Ukraine has also pushed up prices for oil, gas and coal in international markets. The country’s coal imports in the first two months of 2022 fell 17.9% from a year earlier to 3.89 million tonnes, though the value more than doubled to US$859 million. Viet Nam’s Ministry of Industry and Trade has said Vietnam would limit its coal exports to 2 million tonnes in 2022.

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