ADB slightly downgrades Asia-Pacific growth forecast for 2023
The Asian Development Bank on Wednesday slightly downgraded its 2023 Asia-Pacific growth forecast to 4.7 percent but maintained its 4.8 percent projection for 2024, as it sees solid economic growth driven by healthy domestic demand, rebounding tourism and the reopening of China.
Still, the multinational lender warned of growing risks and said weakness in China’s property market should be closely watched. High global interest rates, sporadic supply disruptions due to Russia’s invasion of Ukraine, export restrictions, and extreme weather events caused by El Nino may again trigger rises in food prices, it added.
“Developing Asia continues growing robustly, and inflation pressures are receding,” said ADB Chief Economist Albert Park, referring to the region excluding developed economies. “Some central banks in the region have started to lower interest rates, which will help boost growth. Still, governments need to be vigilant against the many risks that the region faces,” he said.
The ADB also cut its 2023 inflation forecast for developing Asia, including China and India, from 4.2 percent to 3.6 percent, largely due to low inflation in China and the stabilization of food and energy prices. It projected inflation at 3.5 percent in 2024.
South Asia remains the fastest-growing subregion, though its growth outlook was slightly lowered to 5.4 percent in 2023. In Southeast Asia, the ADB forecast growth of 4.6 percent in 2023, slower than the previously expected 4.7 percent, while cutting the outlook for East Asia this year to 4.4 percent from 4.6 percent.
Developing Asia groups 46 Asia-Pacific economies, excluding Japan, Australia, and New Zealand.
