In a supplement published Thursday to its September report on the development outlook for the region, the Asia Development Bank has maintained growth projections of 5.8% for 2015 and 6.0% for 2016. The updated projections include a “slight upgrade” to growth forecasts for China and downward revisions for Central Asia and the Pacific. The ADB has also downgraded its outlook for the major developed economies in the region.
China dominates the projection for East Asia. The ADB has raised its forecast for the country’s 2015 growth from 6.8% to 6.9% and sees 2016 growth of 6.7%: “Despite an ongoing housing overhang and excess industrial capacity, the PRC’s economy has remained resilient, supported primarily by private consumption and services, VoA reported.
In South Asia, the outlook remains positive and previous estimates for growth of 6.9% in 2015 and 7.3% in 2016 were reiterated. India is the driver in the region, and the ADB sees continued strength in the country’s economy “supported by growth in industrial production, public capital expenditure, and retail sales.”
The outlook for Southeast Asia is also unchanged at 4.4% growth this year and 4.9% next year. The region’s largest economy, Indonesia, is expected to see some softening “as a result of lower-than-expected budgetary disbursements and ongoing weakness in exports.”
Central Asia’s outlook has been downgraded from prior growth estimates of 3.3% in 2015 and 4.2% in 2016 to new estimates of 3.2% and 3.7%, respectively. Low commodity prices and a slow recovery in the Russian Federation “remain a drag on economic performance.”
The ADB’s chief economist Shang-Jin Wei said: Although we have seen some softening in a number of economies, the broader regional outlook is for continued steady growth. The region’s growth is supported by vibrant private consumption in (China) and expanded industrial production in India and other countries.
At the same time, countries reliant on commodities are hurting from the global slump in prices, and the slower-than-expected recovery in the US and economic contraction in Japan will continue to weigh on export prospects.
The ADB is based in Manila and is owned by 67 members, including 48 from the region.
