Beyond the Mekong | Economy | Southeast Asia

Reevaluating ASEAN’s Economic Outlook Amid the Iran Conflict

Marcus Tantau from Templeton Research offers fresh insights into the region’s economies as they reel from the impacts of the Hormuz oil crisis.

Marcus Tantau, a senior associate at Templeton Research, returns to Beyond the Mekong for an update on the outlook for ASEAN economies as the crisis in the Middle East persists with the costs of the Israel-U.S. war on Iran hitting government expenditure across the region.

The cost of oil and shipping remains key. The World Bank had cut around one percentage point off regional GDP forecasts for the year, but this could rise substantially in the event of a severe, long term blockade of the Strait of Hormuz. That, combined with inflationary costs, has raised the prospect of stagflation, a significant problem for economists and politicians attempting to steer economies through turbulent times.

“But it’s also got to do with the sort of deceleration of China,” Tantau said, adding China has downgraded its growth target from 5.0 percent to 4.5-5.0 percent. “So that obviously has a flow on effect throughout the region and beyond.”

Tantau spoke with The Diplomat’s Luke Hunt about ASEAN’s outlook for 2026 in January. For this update he has revised his numbers. Tantau lists the region’s........

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