Developing Asia's strong economic expansion is expected to continue, with growth projected at 7.7 percent in 2006 before easing to 7.1 percent in 2007, according to a major ADB report released.
“Developing Asia's rapid growth is underpinned by strong performances by the People's Republic of China (PRC) and India, which together account for more than 50 percent of regional GDP,” said Mr. Ifzal Ali, ADB Chief Economist, in launching Asian Development Outlook 2006 Update.
“The region should take advantage of this strength to act in three areas that could undermine growth if not addressed - the need to complete the adjustment to high oil prices, the need to pick up the pace of fiscal consolidation, and the need to stimulate investment,” he said.
If PRC and India are removed from the calculation, the remaining countries of developing Asia are expected to grow by more modest averages: 5.5 percent in 2006 and 5.1 percent in 2007.
ADO Update is a supplement to ADB's annual flagship publication, Asian Development Outlook 2006, which was published in April and forecasts economic trends in the region.
The 7.7 percent growth forecast for 2006 represents a 0.5 percentage point increase from the April forecast. The upward revision significantly reflects accelerated growth in the PRC due to booming investments and exports. ADO Update forecasts 10.4 percent growth for PRC in 2006.
Upward revision to growth forecasts of the three larger South Asian economies - Bangladesh, India, and Pakistan - on the back of strong export growth also fed the upward adjustment.
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