Bangkok, Dec 22 (efe-epa).- Foreign investment fell by 40 percent in the Asia-Pacific region in the first three quarters of the year, compared to the same period in 2019, due to the Covid-19 pandemic, the United Nations Economic and Social Commission for Asia and the Pacific (Escap) said on Tuesday.
In a statement, Escap said that global restrictions related to Covid-19, including the widespread closures of businesses, factories and in the construction sector, led to the postponement or cancellation of foreign direct investment (FDI) projects.
“FDI is expected to remain below pre-crisis levels throughout 2021. The outlook beyond 2021 is highly uncertain and dependent on the duration of the crisis, the effectiveness of policy interventions to stimulate FDI and navigate the socio-economic effects of the pandemic, as well as geo-economic tensions,” the Escap statement said.
However, the body said that the implementation of the Regional Comprehensive Economic Partnership (RCEP) would help the recovery of foreign investment, “especially for smaller and least developed countries in the group”.
The RCEP, the largest free trade agreement in the world, was signed on November 15 by 15 countries in Asia-Pacific, led by China and including economies such as Japan, South Korea, Australia, New Zealand, Singapore, Indonesia, Malaysia and Thailand, and Vietnam, among others.
Escap predicted that Asia-Pacific will be affected by the drop in international trade, which is expected to fall 14.5 percent this year worldwide, although less than other regions of the world.
“The pandemic has a devastating effect on developed and developing economies alike, threatening to bring possibly millions of people back to poverty and unemployment. These people will not only need more aid, but also more trade,” said Armida Salsiah Alisjahbana, UN Under-Secretary-General and Executive Secretary of Escap.
“I urge countries in the region to work towards developing a better set of trade rules that are resilient in times of crisis and stimulate sustainable economic recovery for inclusive and greener economies.” EFE-EPA