The Asian Development Bank (ADB) has revised upwards its 2024 growth forecast for developing Asia, boosted by rising technology-related exports in South Korea and Taiwan and strong domestic demand across the region.
Developing Asia’s gross domestic product is expected to grow by 5.0 per cent this year, slightly faster than the 4.9 per cent forecast in April, according to the bank’s latest Asian Development Outlook report released on Wednesday. The multilateral lender kept its growth forecast for 2025 unchanged at 4.9 per cent.
Resilient domestic demand and improving exports and production will support growth this year” in developing Asia, the report said. The ADB defines developing Asia as the bank’s 46 developing member countries.
However, the report also listed risks ranging from election uncertainty in the US to heightened geopolitical tensions, including wars in Ukraine and the Middle East. Concerns were also raised about trade fragmentation, which could “re-disrupt supply chains”, and that China’s property slump could worsen.
The ADB maintained its growth forecasts for China at 4.8 per cent this year and 4.5 per cent in 2025.
In the latest report, in addition to China, GDP growth forecasts for India to 2024 remained unchanged from previous forecasts. However, it raised its growth forecast for South Korea from 2.2 per cent to 2.5 per cent and for Taiwan from 3.0 per cent to 3.5 per cent, suggesting that these two technology exporters will continue to benefit from the world’s growing appetite for electronics.
Among Southeast Asian countries, the Philippines and Vietnam are expected to benefit from rising global demand for semiconductors and electronics as they “specialise in integrated circuit packaging and electronics assembly”, the report said. These countries are expected to grow by 6.0 per cent this year, faster than their regional peers.
The bank expects inflation in emerging Asia to slow to 2.9 per cent this year, down from 3.2 per cent forecast in April, and lower than the 3.3 per cent recorded in 2023. The downward trend is attributed to the lagged effects of recent monetary tightening, the report said, adding that some countries in the region have started to loosen monetary policy to stimulate consumption. It noted that countries such as the Philippines are looking to the US Federal Reserve for cues on future monetary policy actions.
The ADB forecasts that price growth across developing Asia will slow to 2.9 per cent this year and remainstable at 3.0 per cent in 2025.
