Why Asia and Europe Are Responding to the Same Crisis Differently
In Europe and Asia alike, policymakers must begin considering how to translate emergency measures into more sustainable policies. Their approaches may not be the same, but their objectives – protecting lives and livelihoods, especially those of the most vulnerable – should be.
SINGAPORE/LUXEMBOURG CITY – COVID-19 has claimed more than 700,000 lives, infected over 19 million people, and decimated rich and poor economies alike. But, even as most of the world faces unprecedented recession, policy responses differ sharply. The contrast between Europe and Asia is a case in point.
Both regions are undoubtedly facing serious economic hardship. The European Commission expects the eurozone economy – which grew by 1.3% in 2019 – to contract by 8.7% this year. In the ASEAN+3 – the ten members of the Association of Southeast Asian Nations (Brunei Darussalam, Cambodia, Indonesia, Lao People’s Democratic Republic, Malaysia, Myanmar, the Philippines, Singapore, Thailand, and Vietnam), plus China, Hong Kong, Japan, and South Korea – GDP growth is expected to plunge to 0% this year, from 4.8% in 2019.
Policymakers in both regions have responded aggressively, with unprecedented monetary and fiscal stimulus, as well as other measures to support the economy. But different economic structures, institutional arrangements, and vulnerabilities mean that the size, content, and distribution of support have been very different.