The Philippines is among the countries in Asia-Pacific whose growth faces imminent threats from the growing protectionist sentiment in the West, especially the United States, according to Hongkong and Shanghai Banking Corp.
Frederic Neumann, co-head of HSBC Asian Economic Research, said while it might take some time to craft measures designed to pull production back in the US, its economic impact might be felt over the coming quarters.
“For one, there might be voluntary restraint by some firms in sourcing goods from Asia to stave off potentially more severe official restrictions,” Neumann said.
Neuman said for Asean, investments could be largely affected, as a number of companies curtailed capital expenditures and worries over market access could amplify this year.
“Foreign direct investment, a key driver of growth in much of Asean, for instance, may slow and so could spending by local companies looking to export part of their production. Growth in Asia, in other words, might suffer even well before restriction on exports to the West become binding,” Neumann said.