Developing Asia remains on track toward steady growth in 2014 despite slower-than-expected growth in the US in the first quarter, the Asian Development Bank (ADB) said Friday.
In its Asian Development Outlook Supplement, the Manila-based lender maintained its April forecast of 6.2 percent growth in 2014 and 6.4 percent in 2015 for Asia's 45 developing economies, excluding Japan and other industrialized countries. "Developing Asia as a region continues to perform well," ADB Deputy Chief Economist Zhuang Juzhong said in Manila, according to ADB's Website. "The pace of the growth moderation in China is in line with our expectations while the stage is set for India to pursue reform that could unlock its growth potential," Zhuang said.
Softer US growth has been somewhat offset by Japan's robust first quarter performance while the euro area has generally met expectations, the ADB said in the report.
The bank kept its growth forecast for China at 7.5 percent in 2014 and 7.4 percent in 2015. The 2014 projection for South Asia, including India, Pakistan, Sri Lanka and Bangladesh, is nudged up 0.1 percentage points to 5.4 percent.
The improved outlook in India pushes up the subregional forecast for 2015 from 5.8 percent to 6.1 percent, the ADB said. "With parliamentary elections over, India is expected to pursue long-delayed reform. India's growth forecast is maintained at 5.5 percent in fiscal year 2014 but upgraded to 6.3 percent in FY 2015 as expected reform bears fruit," it said.
However, the ADB cut growth forecast for Southeast Asia this year, citing the political deadlock in Thailand, soft external demand in Indonesia, as well as the effect of tensions between Vietnam and China.
The 2014 forecast for region is now 4.7 percent, revised down from 5.0 percent in the April estimate. It maintained the forecast of 5.4 percent for 2015, saying the factors slowing growth this year are expected to be temporary.
The ADB is a multilateral development finance institution dedicated to reducing poverty in Asia and the Pacific. Established in 1966, it has now owned by 67 members, mostly from the region, as well as the US, the UK and Germany.