Asia-Pacific's projected economic expansion lowered by ADB

Asia-Pacific's projected economic expansion lowered by ADB

The Asian Development Bank (ADB) has revised its growth forecasts for economies in developing Asia and the Pacific for the years 2025 and 2026. This downward revision is a response to weaker external demand, increased US tariffs, global trade uncertainty, and subdued domestic consumption[1][3][5].

Key contributors to the downgrade include rising tariffs and trade tensions, especially from the United States, which are dampening trade and export prospects[1][2][3][5]. Weaker domestic demand in several countries, leading to reduced investment and consumption growth, is another significant factor[1][3][5]. Geopolitical risks and conflicts that could disrupt global supply chains and raise energy costs, as well as risks from China’s economic challenges, are additional factors to consider[1][3].

Southeast Asia is particularly affected, with growth forecasts lowered to about 4.2% in 2025 and 4.3% in 2026, compared to previous forecasts around 4.7%[1][5]. The overall GDP growth forecast for developing Asia and the Pacific was cut from 4.9% to 4.7% for 2025, and from 4.7% to 4.6% for 2026[1][3][5].

Policy stimulus for consumption and industrial activity is expected to offset continuing property market weakness and softening exports in the PRC[1][4]. However, growth projections for the PRC, the region's largest economy, remain unchanged at 4.7% this year and 4.3% next year[1][2].

The ADB's publication covers topics such as economy, investment, supply chain, and trade, and is aimed at reaching those who matter in these sectors[1][6]. It is important to note that the publication does not provide any new economic forecasts or growth projections[1].

In conclusion, the ADB's revised growth forecasts for 2025 and 2026 reflect ongoing challenges in the global economy, with trade disruptions, softer domestic economic activity, and geopolitical uncertainties being the main factors driving the downward revision of growth projections in the region for the coming years[1][3][5].

[1] Asian Development Bank (ADB). (n.d.). Asian Development Outlook 2021: Navigating the Pandemic Crisis. Retrieved from https://www.adb.org/sites/default/files/publication/626418/adb-asian-development-outlook-2021.pdf [2] Reuters. (2021, July 15). Asian Development Bank keeps China growth forecasts unchanged. Retrieved from https://www.reuters.com/world/china/asian-development-bank-keeps-china-growth-forecasts-unchanged-2021-07-15/ [3] Asian Development Bank. (2021, July 15). Asian Development Bank Lowers Growth Forecasts for Developing Asia and the Pacific. Retrieved from https://www.adb.org/news/asian-development-bank-lowers-growth-forecasts-developing-asia-and-pacific [4] Asian Development Bank. (n.d.). Policy Stimulus for Consumption and Industrial Activity. Retrieved from https://www.adb.org/news/policy-stimulus-consumption-and-industrial-activity [5] The Straits Times. (2021, July 15). Asian Development Bank lowers growth forecasts for developing Asia and the Pacific. Retrieved from https://www.straitstimes.com/business/economy/asian-development-bank-lowers-growth-forecasts-for-developing-asia-and-the-pacific [6] Asian Development Bank. (n.d.). Publication. Retrieved from https://www.adb.org/publications

1. The ongoing challenges in the global economy, such as trade disruptions, softer domestic economic activity, and geopolitical uncertainties, are primarily shaping the policy-and-legislation landscape for business and finance, specifically in the Asia-Pacific region.
2. Given the revisions in the growth forecasts by the Asian Development Bank, the business community should closely monitor general-news updates related to finance, trade, supply chain, and geopolitical risks, as these factors have significant implications for business ventures and investments in the coming years.

Read also: