Forecast for the growth of developing Asia from ADB

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In a supplement to its Asian Development Outlook Update 2017 report, ADB upgrades its 2017 growth domestic product (GDP) outlook in the region by 0.1 percentage points compared to its September 2017 forecast, while its 2018 forecast remains unchanged at 5.8%. An unexpectedly strong expansion in Central, East, and Southeast Asia has offset a downward adjustment in South Asia.

“Developing Asia’s growth momentum, supported by recovering exports, demonstrates that openness to trade remains an essential component of inclusive economic development,” said Yasuyuki Sawada, ADB’s Chief Economist. “Countries can further take advantage of the global recovery by investing in human capital and physical infrastructure that will help sustain growth over the long-term.”

Combined growth for the major industrial economies is revised upward to 2.2% for 2017 and 2% for 2018, due to robust domestic demand in the euro area, and in Japan due to private investment and net exports. Growth projections for the United States remain unchanged at 2.2% in 2017 and 2.4% in 2018.

By subregion, growth for East Asia is revised upward to 6.2% in 2017, from 6%, while 2018 projections of 5.8% are unchanged. Growth prospects in the People’s Republic of China (PRC) which is the world’s second largest economy, are revised up on resilient consumption. Growth in the PRC is now expected to expand by 6.8% in 2017 and 6.4% in 2018.

South Asia will remain the fastest growing of all subregions in Asia and the Pacific, despite a downward revision from previous projections from 6.7% to 6.5% in 2017, and is expected to pick up to 7% in 2018. GDP growth in India which is the subregion’s largest economy, is revised down to 6.7% in 2017 and 7.3% in 2018.

Growth for Southeast Asia is picking up faster than earlier forecast with GDP set to expand by 5.2% in 2017 and 2018, compared to September 2017 forecasts of 5% and 5.1%. The subregion is benefiting from stronger investments and exports, with accelerating growth for Brunei Darussalam, Malaysia, the Philippines, Singapore, and Thailand

In Viet Nam, growth prospects are revised upward to 6.7% in both 2017 and 2018 compared to previous forecasts of 6.3% and 6.5%, respectively. The first 3 quarters of 2017 saw GDP grow by 6.4%, up from 5.9% in the same period of 2016.

The outlook for Central Asia this year has further improved as stronger domestic demand and exports in some countries have fueled recovery in the subregion. Growth is expected to reach 3.6% in 2017 compared to the 3.3% originally projected. The 2018 forecasts for Central Asia are unchanged at 3.9%.

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Growth in the Pacific is expected to remain at 2.9% in 2017 and 3.2% in 2018. Papua New Guinea, which is the subregion’s largest economy, continues its gradual recovery due to rebounding mining and agriculture industries.