The Asian Development Bank forecast developing Asia to rebound this year although the renewed outbreak of the coronavirus poses threat to the recovery.
According to the latest Asian Development Outlook 2021, released Wednesday, economic growth in developing Asia will rebound to 7.3 percent this year from -0.2 percent last year, underpinned by global recovery and early progress in vaccination. However, growth will moderate to 5.3 percent in 2022.
“Growth is gaining momentum across developing Asia, but renewed COVID-19 outbreaks pose a threat to recovery,” ADB chief economist Yasuyuki Sawada, said.
“Economies in the region are on diverging paths. Their trajectories are shaped by the extent of domestic outbreaks, the pace of their vaccine rollouts, and how much they are benefiting from the global recovery,” Sawada added.
The agency noted that robust exports coupled with gradual recovery in household consumption will boost economic activity in China this year. The country’s GDP is projected to expand 8.1 percent in 2021 and 5.5 percent in 2022.
India’s economy is expected to grow 11.0 percent in the fiscal year 2021, which ends on March 31, 2022, amid a strong vaccine drive. GDP growth in the FY2022 is seen at 7.0 percent.
South Asia’s GDP growth is expected to rebound to 9.5 percent in 2021, following a 6.0 percent contraction in 2020, before moderating to 6.6 percent next year. East Asia’s GDP is expected to grow 7.4 percent in 2021 and 5.1 percent in 2022.
Further, the trade-dependent economies of Southeast Asia are also projected to recover, with the sub-region forecast to grow 4.4 percent this year and 5.1 percent in 2022 after contracting 4.0 percent in 2020.
Pacific economies, still affected by global travel restrictions and a collapse in tourism, will post moderate growth this year at 1.4 percent, before expanding by 3.8 percent next year, the Manila-based lender said.
On the price front, the ADB said inflation in developing Asia is set to ease to 2.3 percent from 2.8 percent in 2020, as food-price pressures ease in India and China. Nonetheless, the rate will rise to 2.7 percent in 2022.
Source: Read Full Article