KUALA LUMPUR, June 16 — ASEAN+3’s fiscal position remained broadly resilient in the first quarter (Q1), despite emerging expenditure pressures and tighter financing conditions following the escalation of the West Asia conflict, showed the ASEAN+3 Macroeconomic Research Office’s (AMRO) ASEAN+3 Quarterly Fiscal Bulletin.
The cooperative forum groups ASEAN with China, Japan, and South Korea.
In a statement today, AMRO said Q1 revenue outturns remained generally robust across the region, with most economies recording positive year-to-date revenue growth, supported by strong income and consumption-based tax collections.
“However, resource-related revenues declined among oil exporters, suggesting that the revenue benefits of higher commodity prices have yet to fully materialise.
“Meanwhile, expenditure pressures have begun to build, particularly in economies with broad-based fuel subsidy regimes, while regional 10-year government bond yields rose after the outbreak of the conflict in February 2026,” it said.
Meanwhile, AMRO deputy director of functional surveillance and research Abdurohman, said early signs of stress are emerging, as higher energy and subsidy costs, together with the fiscal costs of recently introduced policy measures, are expected to weigh on fiscal positions.
“Tighter financing conditions are increasing downside risks to the fiscal outlook. The fiscal impact is expected to become more evident in Q2 fiscal outturns,” he said.
According to AMRO, fiscal measures have been at the core of ASEAN+3 governments’ responses to the conflict, with 59 direct fiscal measures and 15 quasi-fiscal measures introduced since the conflict’s onset, and all economies implementing at least one measure.
“Fiscal support across the region has been timely and responsive, but as conditions evolve, policies need to be carefully recalibrated to balance near-term support with medium-term fiscal sustainability.
“Member authorities should prioritise well-targeted and temporary measures. Clear communication and credible medium-term fiscal strategies will be essential to anchor expectations and contain rising fiscal risks,” added Abdurohman.
