STOCK MARKET BSE NSE

Developing Asia Can Sustain Growth Pace, Risks Easing - ADB

Published: 01st April 2014 10:24 AM  |   Last Updated: 01st April 2014 10:24 AM   |  A+A-

* Developing Asia seen growing 6.2 pct in 2014 vs 6.1 in 2013

* China growth revised down to 7.5 pct in 2014, 7.4 in 2015

* India growth raised to 5.5 pct in 2014, 6.0 pct in 2015

Developing Asia is poised to sustain its current growth momentum and is well positioned to manage risks coming from a slightly slower Chinese economy and possible uneven demand from major industrialised nations, the Asian Development Bank said.

Asian nations can undertake preemptive measures to protect the region's growing economy from unpredictable capital inflows, said the Manila-based lender as it unveiled its forecasts for the region for 2014 and 2015.

The bank said it expects the region, grouping 45 counties in Asia-Pacific, to grow 6.2 percent this year, slightly faster than its most recent estimate of 6.0 percent in December, before accelerating further to 6.4 percent in 2015.

"Most regional economies have strengthened their economic fundamentals. Looking ahead, strengthening macroprudential measures before the boom can help avert sudden capital reversals that accompany the bust," the ADB said in its Asian Development Outlook 2014.

While risks to the region's growth outlook have eased, further shock to global financial markets from the U.S. tapering of stimulus and expected policy tightening, an uneven recovery in developed economies, and the possibility of slower growth in China as it aims to curb credit expansion would weigh on the region's economic uptrend, the bank said.

Growth in China is expected to be 7.5 percent this year, the ADB said, slower than its December forecast of 7.7 percent, and will likely lose momentum further to 7.4 percent in 2015 as the country pursues policies aimed at more equitable, balanced and sustainable growth.

India is forecast to accelerate to 5.5 percent this year, much faster than the 4.7 percent forecast in December, although the South Asian nation was still operating below potential which can be solved by clearing investment bottlenecks, the bank said.

Improving global trade conditions will help lift Southeast Asia's growth to 5.0 percent this year, slightly higher than a previous estimate of 4.8 percent, with Malaysia, Singapore and Vietnam leading the way. Political unrest will continue to restrain growth in Thailand, with the economy picking up speed only in 2015, the ADB said.

The bank also said inflation in Asia is expected to be largely steady with global commodity prices remaining soft. Possible upside risks are likely from adjustments in subsidised fuel and power rates in some countries, with regional inflation seen at 3.6 percent, steady from previous forecasts but higher than an actual 3.4 percent last year.

The ADB noted that despite developing Asia's rapid growth, it continues to lag other regions in public spending on education and healthcare. The bank urged countries to expand revenue-raising measures to fund targeted poverty-reduction projects and narrow income gaps.

Stay up to date on all the latest Business news with The New Indian Express App. Download now

Comments

Disclaimer : We respect your thoughts and views! But we need to be judicious while moderating your comments. All the comments will be moderated by the newindianexpress.com editorial. Abstain from posting comments that are obscene, defamatory or inflammatory, and do not indulge in personal attacks. Try to avoid outside hyperlinks inside the comment. Help us delete comments that do not follow these guidelines.

The views expressed in comments published on newindianexpress.com are those of the comment writers alone. They do not represent the views or opinions of newindianexpress.com or its staff, nor do they represent the views or opinions of The New Indian Express Group, or any entity of, or affiliated with, The New Indian Express Group. newindianexpress.com reserves the right to take any or all comments down at any time.

flipboard facebook twitter whatsapp