Tensions continue to simmer in the South China Sea as Covid-19, or ‘the coronavirus’ remains headline news. Will the viral outbreak drive the region closer together or farther apart? Either way, it’s possible that Vietnam stands the most to gain.
The coronavirus is not yet a pandemic, but China is so key to the global economy that a Chinese “local epidemic event” is global in its ramifications.
A novel coronavirus is swiftly emerging as a global health risk that will have significant economic, social and political repercussions. The 2019-nCoV, or the Wuhan coronavirus, undoubtedly has access to every corner of the planet – and it is unfolding in a new age of information that will heighten the fear factor.
Taiwan’s advantages as a place to do business are manifold: it’s strategically located within easy reach of China, Japan, South Korea, Hong Kong, Thailand, Vietnam, Cambodia and Malaysia. It has a massive industrial base – Taiwan is the world’s fourth largest electronics producer – with significant research and development (R&D) supported by public spending. It also has a highly educated and skilled workforce.
By most measurements, the Cambodian economy is healthy. The Asian Development Bank forecasts economic growth of 7% in 2019 and 6.8% for 2020, while the World Bank considers economic growth to be “better than expected” because of increasing exports, growing internal demand, and consistency in foreign investment. But structural problems persist. Cambodia is repeatedly ranked as one of the worst countries in Southeast Asia for corruption. Money laundering remains rife, especially in the gaming and property sectors. The global money-laundering watchdog Financial Action Task Force (FAFT) put Cambodia on its list of countries “highly vulnerable to money laundering” in February. Meanwhile, almost all international financial institutions recommend faster diversification away from low-cost, low-skilled manufacturing, and for Cambodia to carve a niche in high-skilled assembly before others nations in Southeast Asia, namely Thailand and Vietnam, dominate certain industries.