MANILA: Surging global demand for Asian exports and low oil prices will help China and the region’s developing economies grow faster than expected this year and next, the Asian Development Bank said Thursday.
The region should now grow by 5.9 percent this year and 5.8 percent in 2018, the Manila-based lender said in a report.
The bank updated its earlier forecasts, released in April, that predicted 5.7 percent growth for the region this year and next.
“Unanticipated external demand has improved growth prospects for developing Asia,” ADB said.
“The resulting boost to net exports all but suspends growth moderation” in China, the region’s largest economy, it added.
Developing Asia grew by 5.8 percent last year.
China’s economy grew by stronger than expected 6.9 percent in the first half this year, which should help it expand by 6.7 percent for 2017 and 6.4 percent in 2018, it added.
The growth outlook for the manufacturing dynamos of East Asia is brighter, with South Korea energised by receding political uncertainty with the election of a new president, it said.
The bank maintained its 7.4 percent growth forecast for India this year and 7.6 percent for 2018, primarily from strong consumption, and the rest of South Asia’s prospects also remained robust.
Southeast Asia is also on track to meet forecasts of 4.8 percent growth this year and 5.0 percent next year, helped by high first quarter growth in Malaysia, the Philippines and Singapore, the ADB said.
ADB upgraded its forecast growth for the former Soviet republics of Central Asia, with Armenia, Kazakhstan and Tajikistan uplifted by manufacturing and mining.
The bank maintained its earlier projections for Pacific island economies.
It revised its inflation outlook for developing Asia by 0.4 percentage points this year to 2.6 percent, and by 0.2 percentage points next year to 3.0 percent.
“Ample supply has held world oil prices low despite rising demand, while favourable weather has kept food prices stable.”