By Manolo Serapio Jr
MANILA, March 30 (Reuters) – The Asian Development Bank
slashed its economic growth forecast for developing Asia this
year, citing global headwinds and a weaker outlook for China.
Developing Asia will expand 5.7 percent this year and in
2017, the Manila-based lender said in its latest Asian
Development Outlook released on Wednesday.
In its December outlook report, the ADB had forecast 2016
growth for the region at 6.0 percent.
The region, which groups 45 countries in the Asia Pacific,
grew 5.9 percent last year.
“Risks are tilted to the downside as tightening U.S.
monetary policy may heighten financial volatility, further
moderation in China could spill over into its neighbors, and
producer price deflation may undermine growth in some
economies,” said ADB chief economist Shang-Jin Wei.
The ADB forecast growth in China, the world’s second-largest
economy, would slow to 6.5 percent this year from 6.9 percent in
2015, its weakest expansion in a quarter of a century. Growth is
projected to slow further to 6.3 percent in 2017, ADB said.
The bank’s 2016 forecast for China, down from a December
estimate of 6.7 percent, is at the lower end of Beijing’s own
target of 6.5-7 percent as the government presses ahead with
painful reforms, though Premier Li Keqiang has vowed that would
not lead to a hard landing.
Weak prices for oil and other commodities also cast a shadow
over the prospects of Asia’s commodity-dependent economies, the
ADB said.
In the United States, expanding private consumption and
investment will be tempered by weak external demand, the ADB
said. U.S. Federal Reserve policymakers have cited continuing
risks from a shaky global economy in halving the number of
potential interest rate hikes this year to two.
Growth in India will slip to 7.4 percent this year from 7.6
percent in 2015, but should recover to 7.8 percent in 2017, the
ADB said.
For all of South Asia, ADB forecast growth at 6.9 percent in
2016 and 7.3 percent in 2017, versus growth of 7.0 percent last
year.
Economies in Southeast Asia are projected to expand 4.5
percent this year, from 4.4 percent in 2015, and by 4.8 percent
in 2017.
For East Asia, ADB sees growth at 5.7 percent in 2016 and
5.6 percent in 2017. The region grew 6.0 percent last year.
Central Asia is estimated to expand by 2.1 percent this year
and 2.8 percent in 2017, following growth of 2.9 percent in
2015, the bank said.
Annual inflation in developing Asia is expected to recover
to 2.5 percent this year from 2.2 percent in 2015 as domestic
demand strengthens, ADB said. A rebound in global commodity
prices next year should lift inflation to 2.7 percent, it said.
The report is available on the ADB’s website http://www.adb.org
GDP GROWTH, pct Actual –Forecast–
Subregion/
Economy 2015 2016 2017
————— ——-
Date of Forecast March Dec 2015 March
CENTRAL ASIA 2.9 2.1 3.7 2.8
EAST ASIA 6.0 5.7 6.0 5.6
China 6.9 6.5 6.7 6.3
SOUTH ASIA 7.0 6.9 7.3 7.3
India 7.6 7.4 7.8 7.8
SOUTHEAST ASIA 4.4 4.5 4.9 4.8
Indonesia 4.8 5.2 5.3 5.5
Malaysia 5.0 4.2 4.9 4.4
Philippines 5.8 6.0 6.3 6.1
Singapore 2.0 2.0 2.3 2.2
Thailand 2.8 3.0 3.8 3.5
Vietnam 6.7 6.7 6.6 6.5
THE PACIFIC 7.0 3.8 3.8 3.1
________________________________________________________________
DEVELOPING ASIA 5.9 5.7 6.0 5.7
INFLATION, pct Actual –Forecast–
Subregion/
Economy 2015 2016 2017
————— ——–
Date of forecast March Dec 2015 March
CENTRAL ASIA 6.2 10.8 8.4 5.9
EAST ASIA 1.3 1.6 1.8 2.0
China 1.4 1.7 1.8 2.0
SOUTH ASIA 5.0 5.2 5.5 5.7
India 5.0 5.4 5.5 5.8
SOUTHEAST ASIA 2.7 2.6 3.2 2.9
Indonesia 6.4 4.5 4.8 4.2
Malaysia 2.1 2.7 2.9 2.5
Philippines 1.4 2.3 3.0 2.7
Singapore -0.5 -0.6 0.5 0.4
Thailand -0.9 0.6 1.5 2.0
Vietnam 0.6 3.0 4.0 4.0
THE PACIFIC 3.4 4.5 4.4 4.7
________________________________________________________________
DEVELOPING ASIA 2.2 2.5 2.7 2.7
(Reporting by Manolo Serapio Jr.; Additional reporting by
Enrico dela Cruz; Editing by Kim Coghill)
