After the Four-Day Workweek, Now "Cut Down on Business Trips"... Southeast Asia's Drastic Measures Amid Rising Oil Prices

In response to the oil shock originating from the Middle East, Southeast Asian countries have begun implementing measures such as introducing a four-day workweek.

People riding bicycles in Hanoi, Vietnam. Photo by Yonhap News Agency

The Financial Times (FT) reported on March 11 (local time) that concerns are mounting over the economies and fiscal health of Southeast Asian countries, which are heavily dependent on the Middle East for oil and gas.

The Philippine presidential office recently announced that, as part of efforts to conserve energy amid the Middle East crisis triggered by the US and Israel's attack on Iran, official business trips for public officials should be limited to only essential work. This measure comes just days after the government ordered multiple agencies to implement a four-day workweek.

Such measures are not limited to the Philippines. The Thai government instructed agency employees to work from home and encouraged companies to adopt remote work. Meanwhile, Vietnam has advised citizens to carpool or use bicycles. Indonesia has announced plans to increase spending on fuel subsidies.

FT analyzed that concerns about energy supply are arising as Southeast Asian countries face a slowdown in growth. Economists warned that if high oil prices persist, governments providing fuel subsidies could see their fiscal deficits widen. Additionally, it could intensify inflationary pressures, causing central banks to delay interest rate cuts that would otherwise support economic growth. Recently, international oil prices soared to as high as $119 per barrel before retreating to around $80.

A view of the railway station platform in the Manila area.

Economic Slowdown and Middle East War... Southeast Asia's Last Resorts

Bryan Tan, an economist at Barclays, stated, "It would have been much easier for policymakers if the entire economy was running smoothly and all industries were generally performing well. However, in reality, growth is uneven, and from a fiscal perspective, this is placing a considerable burden on many national economies."

Tan explained that Southeast Asia's economic growth has been driven by certain industries such as artificial intelligence (AI) and data centers, but this has not been sufficient to create enough jobs or raise wages. The Asian Development Bank (ADB) estimated that Southeast Asia's gross domestic product (GDP) grew by 4.5% last year, and forecasts that growth will slow slightly to 4.4% in 2026.

However, he assessed that the current Southeast Asian economy is much more stable than during the 1997 Asian financial crisis. Venkateswaran of OCBC said, "Some central banks may need to raise interest rates by the end of the year." He added that the region's economy is currently far more stable than it was during the 1997 Asian financial crisis, when many countries experienced economic and political turmoil.

This content was produced with the assistance of AI translation services.