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Moody's -- Economic recovery will stabilize in APAC, despite risks from the pandemic and secular trends

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Research Announcement:

Moody's -- Economic recovery will stabilize in

APAC, despite risks from the pandemic and secular trends

Singapore, January 26, 2022 --

» The gradual recovery reflects the reopening of economies on the back of increasing vaccination

rates, continued fiscal and monetary support and strong external demand

» But growth disparities will remain as the pandemic, geopolitical tensions, supply chain

reconfiguration and climate considerations exacerbate differences

The pace of economic growth across the Asia-Pacific will stabilize in 2022, supporting a broad

normalization of credit conditions across sectors. That said, risks from the ongoing pandemic and

other secular trends will remain, according to a new report by Moody’s Investors Service.
“The gradual recovery to pre-pandemic output levels in APAC will reflect the reopening of

economies, underpinned by rising vaccination rates, continued monetary or fiscal support that will

wind down only gradually, and robust external demand fueled by household spending, inventory

restocking and global capital spending growth,” says Nishad Majmudar, a Moody’s Assistant Vice

President and Analyst.
Nevertheless, growth disparities within the region and across sectors will remain stark as countries'

pandemic management, vaccination rates and secular trends amplify differences. Credit conditions

will hinge on countries’ capacity to control new virus variants and adapt to endemicity, policymakers’

ability to maintain monetary or fiscal accommodation amid inflationary pressures, and the extent of

international travel recovery.
Developments in the US (Aaa stable) and China (A1 stable) will also be important credit drivers.

A faster pace of monetary policy normalization in the US would negatively affect issuers reliant on

dollar financing and drive capital flow volatility. In China, any policy missteps in the country’s efforts

to contain the impact of its property sector downturn and address social and income inequality could

weaken its economic growth, with implications for the region’s economies.
Several secular trends will continue to present longer-term credit implications for Asian issuers.

Automation, supply chain reconfiguration and geopolitical tensions in parts of the region will affect

the technology and manufacturing sectors. And an increased focus on carbon neutrality will be

negative for the region’s export economies that are unable to achieve their own decarbonization

goals.
Moody’s Credit Trends 2022 virtual event brings you insights and analysis on global credit

developments that will have the biggest impact this year. Hear more about the trends across Asia in

dedicated sessions covering Australia, China, India, Japan and Southeast Asia, starting 8 February.
Register for free here:

https://live.moodys.io/outlooks-2022/credit-trends-2022

Subscribers can access the report at:

http://www.moodys.com/researchdocumentcontentpage.aspx?

docid=PBC_1306409

NOTE TO JOURNALISTS ONLY: For more information, please call one of our global

press information hotlines: New York +1-212-553-0376 , London +44-20-7772-5456 , Tokyo

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+813-5408-4110 , Hong Kong +852-3758-1350 , Sydney +61-2-9270-8141 , Mexico City

001-888-779-5833 , São Paulo 0800-891-2518 , or Buenos Aires 0800-666-3506 . You can also email

us at mediarelations@moodys.com or visit our web site at www.moodys.com.
This publication does not announce a credit rating action. For any credit ratings referenced in this

publication, please see the ratings tab on the issuer/entity page on

www.moodys.com

for the most

updated credit rating action information and rating history.
Nishad Majmudar

AVP-Analyst

Sovereign Risk Group

Moody's Investors Service Singapore Pte. Ltd.

JOURNALISTS: 852 3758 1350

Client Service: 852 3551 3077
Michael Taylor

MD-Credit Strategy

Credit Strategy & Standards

Moody's Investors Service Singapore Pte. Ltd.

JOURNALISTS: 852 3758 1350

Client Service: 852 3551 3077
Releasing Office:

Moody's Investors Service Singapore Pte. Ltd.

50 Raffles Place #23-06

Singapore Land Tower

Singapore, 048623

Singapore

JOURNALISTS: 852 3758 1350

Client Service: 852 3551 3077

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