Posted on 17 Jul 2013
Continued tepid demand from major industrial economies coupled with slower growth in the People’s Republic of China (PRC) are weighing on the outlook for developing Asia, says a new Asian Development Bank (ADB) report.
The latest Asian Development Outlook Supplement, released today, trimmed the 2013 growth forecast for the 45 developing member countries of ADB to 6.3 percent and cut its 2014 forecast to 6.4 percent. In April, ADB predicted the region would grow 6.6 percent this year and 6.7 percent next year.
“The drop in trade and scaling back of investment are part of a more balanced growth path for PRC, the knock-on effect of its slower pace is definitely a concern for the region. We are also seeing more subdued activity across much of developing Asia,” ADB Chief Economist Changyong Rhee said in an official release.
The PRC is likely to see its economy expand 7.7 percent this year and 7.5 percent in 2014 after growth of 7.8 percent in 2012.
The report notes that import and export growth has slowed due to weak external demand, but notes continuing robust consumer confidence.
Slower growth in the PRC has subdued the outlook for the entire East Asia region as well as, albeit to a lesser extent, Southeast Asia where the Philippines and other large ASEAN countries are seeing solid growth.
In India, meanwhile, slow progress in pushing through the reforms needed to ease business bottlenecks means growth is likely to be 5.8 percent this year, slower than the previously forecast 6.0 percent. ADB maintains its 2014 forecast of 6.5 percent for 2014.
