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Collectively, Asia’s developing nations will grow the region’s economy 7.1 percent this year, the Asia Development Bank (ADB) projected, instead of 7.3 percent, as the bank had forecast earlier.
COVID’s Delta variant, the area’s slow and uneven progress in vaccinating citizens, and renewed lockdowns and restrictions on businesses and movement are to blame for the reduction, the ADB noted.
“Developing Asia remains vulnerable to COVID…as new variants spark outbreaks, leading to renewed restrictions in some economies,” ADB economist Joseph Zveglich Jr. said in a conference call with reporters cited by the Xinhua news service.
New outbreaks remain “the main risk” to economic performance, he said.
As of 31 August, only 28.7 percent of the region’s eligible residents had been vaccinated, compared with more than 70 percent in the U.K. and 60 percent in the U.S., Xinhua noted.
The ADB raised its 2022 outlook for the region from a 5.3-percent expansion to 5.4.
Separate from Asia’s emerging nations, China will grow its economy 8.1 percent this year, thanks to continued strong exports, greater government support, and a continuing growth in consumer spending, the bank expects.
However, China’s expansion will slow to a 5.5-percent pace in 2022, the ADB thinks.
Different regions of Asia face different futures, the bank’s report noted.
East Asia’s outlook for this year rose from 7.4 percent to 7.6 percent, in the bank’s estimation, based on global demand for its exports. The ADB’s forecast for 2022 remained unchanged at 5.1 percent.
In contrast, the bank pared its forecast for southeast Asia from 4.4 percent this year to 3.1 and from 5.1 to 5 percent for 2022.
South Asia, dominated by India, will deliver 8.8 percent more economic output this year than last, though less than the 9.5 percent the bank foresaw in April. India’s outlook was trimmed to a 7.5-percent expansion next year, up half a percentage point from the 7 percent the ADB predicted five months earlier.
Inflation across Asia’s developing economies should stay subdued at 2.2 percent this year and 2.7 percent in 2022, although rising food and commodity prices could accelerate the pace, the bank said.
TREND FORECAST: Many Asian nations will slide down the slowing growth curve into yet another round of debt crises and looming defaults. And as U.S. interest rates rise, many emerging market nations will go down. Once again, we renew our forecast noted in “Strong Dollar Threatens Developing Nations” (27 Jul 2021): A new round of debt crises will consign millions of people to poverty and spark political turmoil across the southern half of the globe.