Developing economies in Asia and the Pacific are forecast to expand by 4.9% on average this year as the region continues its resilient growth amid robust domestic demand, improving semiconductor exports, and recovering tourism, says a report released by the Asian Development Bank on April 11.
According to the Asian Development Outlook (ADO) April 2024, growth will continue at the same rate next year. Inflation is expected to moderate in 2024 and 2025, after being pushed up by higher food prices in many economies over the past two years.
Stronger growth in South and Southeast Asia—fueled by both domestic demand and exports—is offsetting a slowdown in China caused by weakness in the property market and subdued consumption.
The report notes that in the Caucasus and Central Asia, growth will normalize after the record-high 2022–2023 levels driven by spillovers from the Russian invasion of Ukraine.
Policy makers should remain vigilant, however, as there are a number of risks. These include supply chain disruptions, uncertainty about US monetary policy, the effects of extreme weather, and further property market weakness in China.
Inflation in developing Asia and the Pacific is expected to decline to 3.2% this year and 3.0% next year, as global price pressures ease and as monetary policy remains tight in many economies. However, for the region excluding China, inflation is still higher than before the COVID-19 pandemic.
The lagged effects of tight monetary policy and higher agricultural production will also mitigate inflation dynamics in the Caucasus and Central Asia, according to ADO April 2024.
Established in 1966, the Asian Development Bank is owned by 68 members—49 from the region.
