Asia growth holds stable thanks to China and India

HONG KONG: The Asian Development Bank said yesterday that growth across the region was holding stable despite global headwinds, with resilience in China and India keeping it on track.

GDP for developing Asia is predicted to grow 5.7 per cent in 2016 and 2017, according to the bank’s latest report – down slightly from 5.9 per cent in 2015.

“Strong growth in the PRC (China) and India is helping the region maintain its growth momentum,” said ADB’s deputy chief economist Juzhong Zhuang.

“Still, policymakers need to watch for the downside risks including potential capital reversals that could be triggered by monetary policy changes in advanced economies, especially the United States.”

Although China growth has dropped from 6.9 per cent last year, its performance so far in 2016 surpassed the bank’s previous forecast, with fiscal and monetary stimulus measures behind the increase, the ADB report said.

The bank revised up slightly its predictions for China growth to 6.6 per cent in 2016 and 6.4 per cent in 2017. Both figures are up 0.1 per cent from the bank’s previous report in March.

India saw a boost to private consumption after recently approved increases in wages and pensions, and a healthy monsoon is likely to lift rural incomes, the ADB said.

It maintained its growth forecast for India at 7.4 per cent for 2016 and 7.8 per cent for 2017, with improvements driven by a recovery in private investment and bank reforms. — AFP