South-east Asia's economies are likely to lean more on fiscal and monetary support in the year ahead. Several developments point to stronger headwinds in the private sector in 2018. The risks to exports are increasing, with signs that the Trump administration is starting to follow through on its hawkish trade rhetoric. What's more, China's growth is poised to slow, and uncertainty from elections in Thailand, Malaysia and Indonesia could damp investment.
Last year, stronger government and household spending drove much of Asean-5's pickup, while net exports dragged on growth in all but one case. Growth in three of the region's five largest economies outperformed the 10-year average. This year, the degree of policy support should be an even bigger factor for the outlook.
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