Economy
Asia Sizzles in Heat Wave Warning.
In a foreboding sign ahead of the upcoming northern hemisphere summer, an emerging El Nino weather pattern is driving temperatures to unprecedented levels across southern parts of Asia. Vietnam experienced its highest recorded temperature of 44.2C, causing concerns over power shortages, while Laos likely shattered its own records. The scorching heat index in the Philippines prompted a reduction in classroom hours, highlighting the dangerous blend of intense heat and humidity.
These searing temperatures are part of a growing trend of extreme weather events in recent years, pushing the world into uncharted territory. The blistering conditions are testing governments’ abilities to safeguard public health and prevent disruptions to agriculture and power generation in economies still recovering from the impacts of Covid-19.
El Nino, characterized by warmer ocean temperatures in the Pacific, has wide-ranging effects on global weather patterns. While it may bring relief to drought-stricken areas in Argentina and the southern US, it blankets parts of Asia and Australia with hotter, drier conditions, posing a significant threat to coffee, sugar, palm oil, and cocoa crops.
Thailand experienced temperatures above 40C in several regions, leading to a surge in power demand. Businesses and banks have urged the government to prepare an action plan to address a potential three-year drought. Meanwhile, Malaysia anticipates a drastic 40% reduction in rainfall in certain areas, endangering palm oil production in one of the world’s leading suppliers. Authorities are closely monitoring forest fires and air pollution, recalling the disastrous haze episode in Southeast Asia caused by a previous El Nino in 2015.
Other parts of Asia, including China, India, and Bangladesh, have also been scorched by the relentless heat in recent weeks. Yunnan province in southwest China faced its worst drought in ten years, while India remains on high alert for further heatwaves after experiencing soaring temperatures in April. These extreme conditions have already led to school closures and tragic heat stroke fatalities.
As the world grapples with the alarming consequences of this heatwave, it becomes evident that urgent action is required to address the escalating impacts of climate change. Failure to mitigate these effects could have severe implications for the environment, public health, and the global economy.
Commerce Minister Tipu Munshi underscored the pivotal role of controlling commodity prices, emphasizing its special importance in the upcoming general election as a key aspect of the Awami League’s manifesto. While addressing concerns about global challenges impacting price control, the minister pointed out the government’s successful efforts to maintain reasonable prices, acknowledging the limitations imposed by the global context.
Speaking at an event organized by the Directorate of National Consumer Rights Protection and Debate for Democracy at the Bangladesh Film Development Corporation (BFDC), Tipu Munshi provided insights into the government’s commitment to ensuring affordable daily necessities for low-income individuals. He highlighted ongoing programs aligned with Prime Minister Sheikh Hasina’s directives, aimed at providing essential items at lower prices to mitigate the hardships faced by the economically vulnerable.
The minister acknowledged the abnormal increase in product prices globally due to factors such as the Russia-Ukraine war and the aftermath of the Covid-19 pandemic. Tipu Munshi stressed the significance of a collaborative effort between the public and private sectors in effectively managing and controlling commodity prices, especially in the face of global uncertainties.
Concluding his remarks, Tipu Munshi emphasized the collective strength of consumers, stating that neither the government nor any syndicate holds ultimate power; rather, the united force of the common people is the most influential. He called on consumers to remain vigilant, asserting that no force can endure if the public remains united.
In a letter signed by FBCCI president Mahbubul Alam, the trade body emphasized that taxpayers faced challenges due to the recent implementation of the new Income Tax Act-2023. The complexities introduced by the new tax regulations, coupled with delayed releases of income tax circulars, have created difficulties for individuals and businesses in preparing their tax returns within the stipulated timeframe.
The FBCCI’s letter further highlighted that various trade bodies have approached them, expressing concerns about the limited time provided for taxpayers to comply. Additionally, the ongoing political situation and the imminent general election have contributed to the constraints faced by taxpayers in meeting the November 30 deadline.
Under the provisions of the new Income Tax Act, there is a mandatory requirement for taxpayers to submit their income tax returns within the designated income tax day. The FBCCI, in light of Section 334 of the Income Tax Act-2023, has formally requested the NBR to extend the deadline for the submission of income tax returns until December 31, 2023.
The FBCCI’s appeal underscores the need for flexibility in recognizing the unique challenges posed by the current circumstances and aims to provide relief to taxpayers who require additional time to comply with the new tax regulations.
The third-quarter performance of Singapore’s economy exceeded expectations, registering a robust 1.1 percent expansion. This growth was propelled by the construction industry and the services sector, particularly tourism. The data from the trade ministry surpassed the anticipated 0.8 percent and marked a significant improvement from the preceding three months.
In response to the positive momentum, officials have revised the full-year forecast for 2023. They now anticipate the economy to grow by 1.0 percent, adjusting from the earlier estimated range of 0.5-1.5 percent. The decision is influenced by improved performance in the US economy since the previous forecast in August. However, officials cautioned that inflation-fighting interest rate hikes may pose challenges in the coming months.
The ministry projected that growth in the US and eurozone would moderate due to the cumulative effects of monetary policy tightening. Similarly, China’s growth is expected to decelerate further due to ongoing weaknesses in its property sector, domestic consumption, and subdued external demand. Despite sluggish global demand for electronics, one of Singapore’s major exports, there are indications that the downturn may be stabilizing.
Continued growth in tourism arrivals is anticipated to support aviation and tourism-related businesses. Taking into account the overall performance of Singapore’s economy in the first three quarters of the year, along with the latest external and domestic developments, the GDP growth forecast for 2023 has been narrowed to around 1.0 percent.
Looking ahead to 2024, the ministry foresees a growth range of 1.0-3.0 percent. However, potential downside risks include high inflation and an escalation of conflicts, such as those between Israel and Hamas or the war in Ukraine. The confluence of these factors could impact business and consumer sentiments, leading to a potential slowdown in global growth and trade.
