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Cambodia’s GDP growth rate will remain stable over the next two years at 7.1%, up slightly from 7% in 2016.
Cambodia’s GDP growth rate will remain stable over the next two years at 7.1%, up slightly from 7% in 2016.

ADB Says Developing Asian Nations Will Drive Global Growth

Strong consumer demand and rising global commodity prices could cause the inflation pace in developing Asia to quicken to 3% this year and to 3.2% in 2018

ADB Says Developing Asian Nations Will Drive Global Growth

Developing Asian countries will drive the world economy in the next two years, the Asian Development Bank said Thursday, but it warned of uncertainties from the United States and Europe.
Its flagship Asian Development Outlook said India, Malaysia, Indonesia and Vietnam will be behind an expected 5.7% increase in Asia-Pacific gross domestic product, with China’s expansion seen moderating, AFP reported.
“Developing Asia continues to drive the global economy even as the region adjusts to a more consumption-driven economy in the People’s Republic of China,” ADB’s chief economist, Yasuyuki Sawada, said in a statement.
With China’s economy seen slowing to 6.5% growth in 2017 and then 6.2% in 2018, regional expansion is tipped to come in slightly weaker than the 5.8% seen last year.
Chinese growth is at its weakest levels in a quarter of a century, hit by a drop in global demand for its goods but also as its leaders try to transform it from an economy driven by trade and state investment to one supported by domestic demand.
Drag on India Growth
India’s economy is set to grow at 7.4% in the current fiscal year 2017-18 against 7.1% in the previous year, on the back of pick-up in consumption demand and higher public investment, the ADB said.
While the recent gross domestic product data for 2016-17 did not fully capture the effects of demonetization, the slowdown did reflect a continued slump in investment. “Dragging on growth were excess production capacity, problems that past overinvestment left on corporate balance sheets, and new bank lending inhibited by too many stressed assets. Moderately higher growth is projected as consumption picks up and government initiatives boost private investment,” it said.
Cambodia's economic growth remained strong last year though the kingdom must now address major systemic challenges to build on its ascension into lower-middle income status in order to maintain healthy levels of development, the ADB said.
The ADB flagship report forecasts that Cambodia’s GDP growth rate will remain stable over the next two years at 7.1%, up slightly from 7% in 2016. Inflation is expected to increase this year to 3.4%, up from 3% in 2016, and will continue to increase incrementally in 2018 to 3.5%.
Philippine GDP growth will likely ease this year—the only Southeast Asian economy that will do so from 2016—in the face of external headwinds, but the country will still outperform many in Asia and most regional averages, ADB estimates. It said Philippine will retain 6.4% GDP growth. Philippine economic growth is then expected to pick up to 6.6% next year.
Meanwhile, ADB has projected Pakistan’s economic growth at 5.2% for the current fiscal year due to better security, macroeconomic stability and investment under the China-Pakistan Economic Corridor projects.
Strong consumer demand and rising global commodity prices could cause the inflation pace in developing Asia to quicken to 3% this year and to 3.2% in 2018, the ADB said.
Uncertainties From US, Europe
The Manila-based regional bank also warned that the uncertain outlook in the United States and Europe threw up risks.
As the US economy continues to strengthen, expectations are for the Federal Reserve to raise interest rates further this year–having already been lifted twice since December.
Higher Fed borrowing costs tend to hit emerging economies as it means investors withdraw their cash to seek better and safer returns in the US.
“Rising consumer and business confidence and a declining unemployment rate have fuelled US growth, but uncertainty over future economic policies may test confidence,” the ADB said.
There are also lingering worries about President Donald Trump’s warnings to revise global trade deals, fuelling speculation he could spark a trade war.
The bank also said that while the eurozone was also strengthening, any potential growth was clouded by the uncertainty of Britain’s decision to leave the European Union.
But Sawada added: “While uncertain policy changes in advanced economies do pose a risk to the outlook, we feel that most economies are well positioned to weather potential short-term shocks.”

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