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Asia

ADB says developing Asian economies are holding steady

Associated Press
Published | Updated
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    FILE - In this Sept. 2, 2016 file photo, a man on a motorbike and a pedestrian pass by a construction site wall depicting the skyline of the Chinese capital in Beijing. Developing economies in Asia are holding steady and will grow at the earlier forecast rate of 5.7 percent this year and next, buoyed by resilience in the region's two largest economies, China and India, the Asian Development Bank said Tuesday, Sept. 27, 2016. (AP Photo/Andy Wong, File) (The Associated Press)

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    FILE - In this May 31, 2016 file photo, an Indian worker grinds metal to finish a part made for heavy vehicles at an industrial unit in Bangalore, India. Developing economies in Asia are holding steady and will grow at the earlier forecast rate of 5.7 percent this year and next, buoyed by resilience in the region's two largest economies, China and India, the Asian Development Bank said Tuesday, Sept. 27, 2016. (AP Photo/Aijaz Rahi, File) (The Associated Press)

MANILA, Philippines – The Asian Development Bank says the economies of developing countries in Asia are holding up despite stubborn global headwinds, and that earlier forecasts that the countries as a group will grow 5.7 percent in 2016 and 2017 remain unchanged. The group grew 5.9 percent in 2015.

A bank report released Tuesday said China, the world's second-largest economy, is expected to grow by 6.6 percent in 2016 and 6.4 percent in 2017, 0.1 percentage points more than was forecast in March, due to strong fiscal and monetary stimulus to boost domestic demand while external demand remains tepid.

The report says steady progress on reforms is helping India realize its growth targets, with earlier forecasts of 7.4 percent growth in 2016 and 7.8 percent in 2017 unchanged.

The India forecasts take into account a boost in private consumption after recent wage and pension increases and expectations of a healthy monsoon lifting rural incomes. A recovery in private investment will help drive growth to 7.8 percent in 2017, the report by the Manila-based bank said.

Growth in the five largest economies in Southeast Asia was forecast at 4.8 percent in 2016, the same as projected in March, with strong first-half performances in the Philippines and Thailand offset by a cut in forecasts for Indonesia, Malaysia and Vietnam.

Government investment in infrastructure, particularly in Indonesia, the Philippines and Thailand, has countered sluggish export demand and droughts that caused a drop in agriculture output in the first half of the year in the Philippines and Thailand, the report said.

Growth is forecast to accelerate to 5.0 percent in 2017 on expectation of firmer demand from major industrial economies, higher prices for exports, and rising infrastructure investment, it said.