Developing Asia to grow by 6%: ADB


The Asian Development Bank has revised upwards its 2017 growth projection for Malaysia from 5.4 per cent to 5.8 per cent.

The Asian Development Bank (ADB) has raised its economic growth forecasts for the Philippines amid strong infrastructure investment and robust consumption. Price inflation is unchanged from previous projections of 2.4% in 2017 and 2.9% in 2018.

Fitch Ratings on December 4 lowered its forecast for India's growth for the current fiscal to 6.7 per cent from the earlier projected 6.9 per cent, saying the rebound was weaker than expected.

"GDP is now seen to expand by 5.2 percent in 2017 and 2018".

It also cut GDP growth forecast for 2018-19 to 7.3 per cent from 7.4 per cent predicted in its September Global Economic Outlook (GEO). The 2018 forecasts for Central Asia are unchanged at 3.9%.

Thai GDP in the third quarter grew at its fastest pace since the first quarter of 2013, driven by exports, personal spending and private investment.

"Agriculture recovered and grew by 2.8 per cent in the first nine months as drought eased in the Mekong Delta and the Central Highlands".

"Public expenditure accelerated, particularly for infrastructure".

Combined growth for the major industrial economies has been revised upward to 2.2 per cent for 2017 and 2 per cent for 2018 due to robust domestic demand in the euro area, and in Japan due to private investment and net exports.

Even though ADB's economic growth forecast of 3.8% for next year is below the Finance Ministry's prediction, both forecasts suggest that the country's growth is improving, said Finance Ministry spokeswoman Kulaya Tantitemit. Excluding Asia's newly industrialized economies, growth is now expected at 6.5 percent this year.

Citing resilient consumption, growth forecasts in the People's Republic of China, the world's second largest economy, were revised up to 6.8 percent in 2017 and 6.4 percent in 2018.

The bank said industry growth in Malaysia was comprehensive. "However, a continued expansion in external demand will generate positive spillovers to the domestic economy through the income and investment channels". Inflation is now projected to average 3.7 per cent in 2017-18, somewhat below the 4 per cent earlier forecast. "Lingering political uncertainty will continue to weigh on investor sentiments".

Next year, International Monetary Fund and World Bank see the country growing 6.7%, while ESCAP has projected 6.8%. Fourth quarter manufacturing growth, traditionally the sector's strongest, is likely to exceed growth over the first three quarters.

Global oil prices are projected to be marginally higher in 2018, but prices of other commodities, such as sugar and rubber, are unlikely to rise because of oversupply, she said. "Fuel prices also inched up in response to rising global crude oil prices", it said.

Thailand's policy rate is unlikely to rise because inflation is projected to be below 1.2%, while a higher USA yield will result in a narrower interest gap between Thailand and the U.S., she said.