Asian economies will deliver strong growth in 2006

07 Apr '06

3 min read

ADB (Asian Development Bank) announces that the developing Asian economies will deliver strong growth in 2006 supported by a broadly favorable outlook for the international economy, the continuing trend toward improved economic management, and apparent resilience to high oil prices.

ADB's flagship annual economic publication, Asian Development Outlook (ADO), launched in Hong Kong, China, projects the region will achieve an overall economic expansion of 7.2 percent in 2006 and 7 percent in 2007, a marginal easing from 7.4 percent in 2005.

“The strength of the global economy remains a key determinant of growth in developing Asia,” says Ifzal Ali, Chief Economist of the Manila-based multilateral development bank. “The major industrial economies are expected to grow close to potential and global trade will remain firm this year.”

Growth projections for developing Asia as a region are heavily influenced by three key economies: PRC, India, and Republic of Korea. Together, these economies have a combined weight of 66 percent of regional income.

In 2005, growth in PRC of 9.9 percent comes after back-to-back years of double-digit expansion. Booming exports and investment continued to propel demand, and growth of industrial output accelerated.

The Chinese government is now targeting a slower growth trajectory for the economy as it intends to focus on some of the social and environmental stresses that have emerged as a consequence of rapid economic expansion in recent years. PRC growth is forecast to ease to 9.5 percent in 2006, softening further to about 8.8 percent in 2007, according to ADO.

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