(MENAFN- Emirates News Agency (WAM))
MANILA, 1st July, 2017 (WAM) -- The economic growth prospects for development in Asia in 2017 have improved on the back of stronger-than-expected export demand in the first quarter of the year, according to a new report from the Asian Development Bank, ADB.
In a supplement to its "Asian Development Outlook 2017" report, ADB upgraded its growth outlook for the region from 5.7 percent to 5.9 percent in 2017, and from 5.7 percent to 5.8 percent in 2018. The smaller-than-expected growth in 2018 reflects its cautious view on the sustainability of this export increase.
"Developing Asia is off to a good start this year, with improved exports pushing up growth prospects for the rest of 2017," said Yasuyuki Sawada, ADB's Chief Economist, adding, "Despite lingering uncertainties surrounding the strength of the global recovery, we feel that the region's economies are well-placed to face potential shocks to the outlook."
The combined growth of the region's major industrial economies is forecast to remain at 1.9 percent in 2017 and 2018. Improved forecasts for the Euro Zone and Japan, due to robust domestic demand, have offset the slight downturn in growth in the United States to 2.2 percent, from the previously projected 2.4 percent, because of disappointing first quarter results in 2017.
Growth in East Asia has been revised to increase by 6.0 percent in 2017 and 5.7 percent in 2018, from the original projections of 5.8 percent and 5.6 percent respectively. After recent growth moderation, an increase in net exports and domestic consumption have improved growth prospects in the People's Republic of China. The world's second largest economy is now expected to expand by 6.7 percent in 2017 and 6.4 percent in 2018.
South Asia will remain the fastest growing sub-region in Asia and the Pacific, with its growth on track to meet the original projections of 7.0 percent in 2017 and 7.2 percent in 2018, according to the report. India, the sub-region's largest economy, is expected to achieve its previous growth projections of 7.4 percent in 2017 and 7.6 percent in 2018, primarily through strong levels of spending.
The growth projection for Southeast Asia is expected to remain at 4.8 percent in 2017 and 5.0 percent in 2018, with accelerating growth in Malaysia, the Philippines and Singapore, although this trend is slightly dampened by the slower-than-anticipated expansion in Brunei Darussalam. Robust domestic demand, particularly in private spending and investments, will continue to support growth in the sub-region, according to the report.
This year's outlook for Central Asia has also improved, as stronger domestic demand and exports in some countries have fuelled an unexpected recovery in the sub-region. Growth is expected to reach 3.2 percent in 2017 and 3.8 percent in 2018, compared to the original projections of 3.1 percent and 3 percent respectively.
Growth in the Pacific region is expected to remain at 2.9 percent in 2017 and 3.3 percent in 2018, with Papua New Guinea, the sub-region's largest economy, continuing its gradual recovery due to its rebounding mining and agriculture industries. Stronger tourism prospects are also expected to drive further growth in the sub-region, particularly in Fiji and Palau.
Consumer price inflation in the region is projected to be lower than the previous estimate, on the back of steady international oil and food prices despite increasing demand, due to adequate supplies and favourable weather conditions. Price inflation is now expected to drop to 2.6 percent in 2017 and 3.0 percent in 2018, compared to the original projections of 3.0 percent and 3.2 percent respectively.
WAM/Tariq alfaham
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