The Asian Development Bank said on Thursday developing Asia is on track to meet the lender’s growth expectations for this year and next, even as trade tensions between the United States and China keep casting a shadow over the global economy.
Developing Asia, a group of 45 countries in the Asia-Pacific region, is still expected to grow 5.7 per cent this year and 5.6 per cent next year, the ADB said in a supplement to its Asian Development Outlook report issued in April.
“Even as the trade conflict continues, the region is set to maintain strong but moderating growth”, said ADB Chief Economist Yasuyuki Sawada. “However, until the world’s two largest economies reach agreement, uncertainty will continue to weigh on the regional outlook.”
The ADB also kept its 6.3 per cent and 6.1 per cent growth projections for China for 2019 and 2020, even after growth in the world’s second largest economy slowed to 6.2 per cent in the second quarter, saying policy support should offset softening growth in domestic and external demand.
The lender cut India’s growth forecast to 7.0 per cent in 2019 and 7.2 per cent in 2020, from 7.2 per cent and 7.3 per cent, respectively, seen in April.
Citing higher oil prices, the ADB raised its average inflation forecast for developing Asia to 2.6 per cent for 2019 and 2020 from 2.5 per cent for both years.