The ADB revised down its growth forecast for the region to six percent for 2013, from 6.6 percent.
For 2014, growth is now projected at 6.2 percent.
“Asia and the Pacific 2013 growth will come in below earlier projections due to more moderate activity in the region’s two largest economies and effects of QE nervousness,” said Changyong Rhee, chief economist of the ADB. “While economic activity will edge back up in 2014, current conditions highlight the need for the region to exercise vigilance to safeguard financial stability in the short term while accelerating structural reforms to sustain economic growth in the longer term.”
In its latest report, the bank said that softer than expected economic activity in China and India and concerns over the U.S. wind-back of its quantitative easing (QE) programme will weigh on Asia and the Pacific’s growth prospects in the near term.
It added that growth in South East Asia will be hampered by weak performances in Thailand, Indonesia and Malaysia, due to weak exports, and that the slowing growth “highlights the need to push ahead with overdue reforms in areas like foreign direct investment, infrastructure development, fiscal consolidation and social protection.”
Image: © Getty
Copyright is owned by Asia Outlook and/or Outlook Publishing. All rights reserved.