ADB trims developing Asia's growth forecast, flags US trade policy risks
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The outlook for developing Asia could worsen if Trump makes swift changes to US trade policy, the Asian Development Bank said.
PHOTO: BLOOMBERG
MANILA - Developing Asia is likely to grow more slowly than previously thought in 2024 and 2025, and the outlook could worsen if President-elect Donald Trump makes swift changes to US trade policy
Developing Asia, which includes 46 Asia-Pacific countries stretching from Georgia to Samoa – and excludes Japan, Australia and New Zealand – is projected to grow 4.9 per cent in 2024 and 4.8 per cent in 2025, slightly lower than the ADB’s forecasts of 5 per cent and 4.9 per cent in September.
The downgraded growth estimates reflect lacklustre economic performance in some economies during the third quarter and a weaker outlook for consumption, the bank said.
Growth forecasts for China remain unchanged at 4.8 per cent for 2024 and 4.5 per cent for 2025, but the ADB lowered its projections for India to 6.5 per cent for 2024 from 7 per cent previously, and to 7 per cent for 2025 from 7.2 per cent.
“Changes to US trade, fiscal, and immigration policies could dent growth and boost inflation in developing Asia,” the ADB said in its Asian Development Outlook report, though it noted most effects were likely to manifest beyond the 2024-2025 forecast horizon.
Trump, who takes office on Jan 20, has threatened to impose tariffs in excess of 60 per cent on US imports of Chinese goods, crackdown on illegal migrants, and extend tax cuts.
“Downside risks persist and include faster and larger US policy shifts than currently envisioned, a worsening of geopolitical tensions, and an even weaker PRC (People’s Republic of China) property market,” the ADB said.
The ADB lowered its inflation forecasts for 2024 and 2025 to 2.7 per cent and 2.6 per cent, respectively, from 2.8 per cent and 2.9 per cent previously, due to softening global commodity prices. REUTERS
