Expressed opinions Entrepreneur Contributors are their own.
Despite the silent outlook for China and India in 2022, we have reason to believe that Southeast Asia will not have comparable devastation and depression – in fact, it will increase compared to 2021.
It certainly sounds like something I would say as a strong believer in the wonderful potential of Southeast Asia. But, I’m just looking at the evidence. I am not saying that in 2022, Southeast Asia will see sunk in sunny optimism. I would say that there are domestic and international factors contributing to the growth of this region towards the end of this year.
Let’s look at those reasons, and why I believe this year will be better for Southeast Asia than last year.
Tourism is finally on rebound
Tourism is one of the most important industries in Southeast Asia, and it is finally recovering. The problem is, this rebound is happening slowly – as the number of vaccinations is slowly increasing across the region. Although the slow pace is steady, and I don’t think many people expected improvement after such a terrible race between 2020 and 2021.
As we slowly emerge from the shadows of those difficult times, we see that efforts are being made to improve the safety and confidence of tourists. We’re seeing more visitors every day – and it’s not just backpackers and budget travelers. We are seeing a trend towards more developed populations, especially in the field of medical tourism like Thailand and Bali.
Regardless of the population, Thailand’s preferences have increased from about 20,000 tourists in October 2021 to about 91,000 in November 2021. Of course, Thailand is accustomed to 3 million tourists per month before pre-covid ৷ But still glad to see the numbers slowly coming out of the uncomfortable situation.
Tourism has always been an integral part of Southeast Asia. Its slow but steady progress towards its former 400 billion glory will begin to feed into other sectors, boost consumer confidence and generally contribute to the economic health of the region in general.
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The growing number of vaccines is helping the private sector gain momentum
Governments in the region are relying less on lockdowns to stop the spread of the virus as vaccinations continue to grow. This will allow the private sector to return to full capacity, as they are no longer hampered by restrictions on movement and trade.
This is good news for the private sector. They can now resume their activities and help grow in this area. This is also good news for consumers. They will now have access to more products and services. Finally good news for the workers. They can now find employment in the private sector.
A revived private sector means improved supply chains
The private sector has stopped its work. It will take time to improve the supply chain and production line to help meet the demand that has been stuck for a year or two. That said, I cautiously hope a high-demand market will soon have an impact in this region. Its GDP is driven by increased exports of goods and services from Southeast Asia to the starving world economy.
Southeast Asian countries will eventually see an increase in exports. They are no longer hampered by roadblocks and supply chain problems. The pace of export growth may be slower than in other regions. However, it is still a positive indicator for the future health of the Southeast Asian economy.
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Increased energy demand means innovation and jobs
As the Southeast Asian economy continues to grow, so does the demand for energy. This increased demand is good news for energy producers. It will create a vendor market and drive innovation in the aging, fossil fuel-dominated energy sector.
Southeast Asia’s energy demand is expected to grow by 60 percent by 2040, and it cannot come from fossil fuels. It must come from a regional power grid that uses more efficient and even renewable energy sources. The ASEAN Plan of Action for Energy Cooperation (APAEC) has already developed plans for this.
This is also good news for the workers. This will create employment in the energy sector. Many of these works will be on sustainable energy sources, such as solar and wind power. These resources are becoming increasingly important as the world moves away from traditional, polluting energy sources.
Rising energy demand in Southeast Asia is a sign of economic health and vitality in the region. This is a sign of the region’s commitment to sustainability, which is important in the years ahead and highlighted by our reputation for innovation on the world stage. It will also be an easy pull factor for green-centric tourism.
Again, cautious optimism is needed for Southeast Asia’s growth prospects in 2022. But still optimistic. The growing number of tourists, a return to the private sector and an impending increase in energy demand are expected. Although there are still some challenges that need to be addressed, such as improving the long knotted supply chain and exporting goods, things are looking for this region. Let’s hope that this growth can be sustained in the years to come as we emerge from this epidemic.
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