Another ‘Unprecedented’ Crisis? This, Too, Shall Pass

“Unprecedented, once-in-a-generation” crises have a bad habit of occurring quite regularly—at least three times over the past 25 years! The current one—the COVID Crisis—takes place some 13 years after the start of the global financial crisis (GFC), which hit 10 years following the onset of the Asian financial crisis (AFC). During its worst moments, it’s often difficult to conceive how a crisis will be resolved, without the benefit of hindsight.  But, experience suggests that economic activity eventually rebounds and growth always resumes. We dissect the growth profiles, trajectories, and market impact of the AFC, GFC, and COVID Crisis and show that, despite the ongoing economic disruptions wrought by the pandemic, several economies in the ASEAN+3 region may have actually experienced darker moments in their history before eventually recovering. That said, each crisis has tended to shift an economy’s trajectory away from its initial trend growth, rarely to revert.

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