Even with the downgraded forecasts, developing Asia will still do better than other regions globally, both in terms of growth and inflation.
By Staff Reporter
ISLAMABAD: The Asian Development Bank (ADB) Tuesday lowered its economic growth forecasts for developing Asia and the Pacific amid a worsened global outlook.
The region’s economy will grow 4.2 percent over fiscal year 2022 and 4.6 percent over fiscal year 2023, ADB said in a statement from its Manila headquarters simultaneously with the publication of its regular supplement to the Asian Development Outlook (ADO) 2022.
This is a downgrade from the ADB’s September estimates that put economic growth at 4.3 percent in 2022 and 4.9 percent in 2023.
The three main headwinds cited by the bank as slowing down developing Asia’s recovery from the COVID-19 pandemic are monetary policy tightening by central banks globally and in the region; the protracted Russian invasion of Ukraine; and recurring lockdowns in the People’s Republic of China (PRC).
Restrictions under the “zero-COVID” approach, along with a struggling property market, have led to another downgrade of the PRC’s growth outlook.
“Asia and the Pacific will continue to recover, but worsening global conditions mean that the region’s momentum is losing some steam as we head into the new year,” said ADB Chief Economist Albert Park.
“Governments will need to work together more closely to overcome the lingering challenges of COVID-19, combat the effects of high food and energy prices—especially on the poor and vulnerable—and ensure a sustainable, inclusive economic recovery.”
ADB lowered its forecast for inflation in developing Asia and the Pacific this year to 4.4 percent from 4.5 percent. However, the bank raised its projection for next year to 4.2 percent from 4.0 percent, due to lingering inflationary pressures from energy and food.
The PRC’s economy is forecast to expand by 3.0 percent this year, compared with a previous projection of 3.3 percent. The forecast for next year was cut to 4.3 percent from 4.5 percent, due to the global slowdown.
Gross domestic product growth projections for India were maintained at 7.0 percent this fiscal year and 7.2 percent next fiscal year.
“Even with the downgraded forecasts, developing Asia will still do better than other regions globally, both in terms of growth and inflation”, the statement said.
“ADB’s growth forecast for Southeast Asia this year was raised to 5.5 percent from 5.1 percent, amid robust consumption and tourism recovery in Malaysia, the Philippines, Thailand, and Vietnam. Projections for next year, however, were lowered to 4.7 percent from 5.0 percent due to weakening global demand.
“The growth forecast for the Caucasus and Central Asia this year was upgraded to 4.8 percent from 3.9 percent, while the projection for the Pacific was raised to 5.3 percent from 4.7 percent, due to a strong tourism recovery in Fiji.”
Asian Development Outlook (ADO) is published every April, with an update in September and brief supplements published normally in July and December. Developing Asia refers to the bank’s 46 developing members.
The ADB said is committed to achieving a prosperous, inclusive, resilient, and sustainable Asia and the Pacific, while sustaining its efforts to eradicate extreme poverty.
The full presentation for the December 2022 supplement to the ADO 2022 may be seen below.
Copyright © 2021 Independent Pakistan | All rights reserved
