Singapore, Malaysia and Thailand are susceptible to a prolonged period of subdued global demand.
KUALA LUMPUR: The economies of export-driven Malaysia, Singapore, Thailand and Vietnam would be impacted under US President elect Donald Trump's shift towards lower levels of US imports and foreign direct investment (FDI).
Moody's Investors Service said on Wednesday these four countries face adverse consequences, given that global exports account for 50%-150% of these countries' GDP.
The ratings agency said while the nature of policies under the next US administration is uncertain, Trump's campaign proposals indicate a shift towards lower levels of US imports and FDIs.
“Sovereigns such as the Philippines are vulnerable to more inwardly focused policies in the US, because the Philippines, for instance, would suffer the effects of policies that disincentivise the
foreign sourcing of services by US companies,” it said.
The outlook was contained in its latest edition of Inside Asean, a quarterly publication that examines the major credit trends across Asean, through recently published Moody's reports.
One of the articles featured in the periodical focuses on the effects of a Trump presidency on trade, investment and growth for Asean sovereigns.
The publication also explains Moody's outlook for corporate profits in Indonesia through 2017.
Moody's expects that Indonesia's GDP will grow 5.2% in 2017, supporting corporate earnings growth of 2%-6%.
“In particular, higher commodity prices will benefit the oil & gas, palm oil and coal sectors, while state-owned entities will help the government fund and execute large infrastructure projects.
“On the stable outlook for the Philippine banking system over the next 12-18 months, Moody's says the outlook is based on the robust fundamentals of the system, and the country's macroeconomic stability.
“As for Singapore's REIT sector, Moody's says the trusts' high leverage and weak operating environment will pressure their credit profiles over the next 12-18 months,” it said.
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