4
}
ECONOMIC PROSPECTS FOR THE ASEAN COUNTRIES AND BRUNEI
1.
Like the rest of the developing world, all ASEAN economies are suffering from the effects of the world recession and a fall in commodity prices. Growth rates have fallen in the last 2 years and growth forecasts for 1982 have been cut back:
GROWTH RATE
late 1970's
1981
forecast for 1982
Malaysia
88
6.5%
48
Indonesia
9.6%
7.8%
Thailand
88
78
5%
Philippines
5.3%
5.4%
Singapore
8.9%
9.9%
4.7% under 6%
Indonesia.
2. In the short-term the Indonesian economy is heading for a show-down because of low oil orices. Indonesia cannot expand her oil exports or carry on borrowing at the present rate because she already has a relatively high debt service ratio. In the longer term the growth rate should pick up again when the oil price rises. In the meantime Indonesia is trying to increase her non-oil exports by a policy of counter-trading. Indonesia is very well endowed with energy resources but she also has the fifth largest population in the world and a lot of energy will be needed for domestic development. In order to keep up foreign exchange earnings and credit-worthiness when the oil market recovers, Indonesia needs to redúce her dependence on oil for domestic consumption by developing alternative energy sources.
Malaysia
3.
Malaysia has the advantage of a high credit rating and should have no problem in seeking further financing from abroad. Like Indonesia, Malaysia needs to reduce her dependence on oil for domestic consumption but with a much smaller population, Malaysia has more energy and other resources per capita. Malaysia also has a bigger industrial base. Malaysia is therefore likely to recover quickly when the world economy turns around, although some of her most ambitious projects have had to be abandoned.
Thailand
4. Thailand is reducing her oil imports by developing offshore natural gas and hydro-electricity and by rigorous energy conservation measures. Thailand has a competitive industrial sector and is ASEAN's only exporter of agricultural products. Thailand's debt ratio is expected to peak at 18% in 1995 and then to decline slowly. Like Singapore, Thailand's high dependence on external
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