ISLAMABAD: With the ongoing global recovery and a rebound in global commodity prices, trade growth in developing Asia turned around in the fourth quarter of last year after stagnation or worse in most of 2015 and 2016, ADB says in its supplement to the ‘Asian Development Outlook’.
The report says the revival in regional trade gathered momentum in 2017, growing 13.3pc by value in the first eight months of the year. The region’s 10 largest economies, which account for 93pc of its trade, saw average trade volume grow by 5.3pc in the first nine months despite downside risks posed by policy uncertainty among the world’s major trading partners and the potential for bilateral trade friction.
Trade expansion helped firm the outlook for developing Asia to 6pc growth in 2017 from 5.9pc projected in September. Meanwhile, the latest ADB assessment retains the 5.8pc outlook for 2018. Excluding Asia’s newly industrialised economies, growth is now expected at 6.5pc in 2017 and 6.3pc in 2018.
The growth outlook for developing Asia this year is upgraded to 6pc, or 0.1 percentage points higher than the rate envisaged in September in Asian Development Outlook 2017 update, as unexpectedly strong expansion in Central, East, and Southeast Asia more than offsets a downward adjustment to growth forecasts for South Asia.
Growth projections for Afghanistan, Maldives, Nepal, Pakistan, and Sri Lanka are as in the Update, which put GDP growth in Pakistan to accelerate to 5.5pc. In aggregate, the growth forecast for South Asia is now revised down to 6.5pc for 2017 but maintained at 7pc for 2018.
In 2018, regional growth is expected to slow slightly to 5.8pc, as predicted in the update. Excluding the newly industrialised economies of South Korea, Singapore, Taipei, China, and Hong Kong, China, the growth outlook for the region is revised up to 6.5pc from 6.4pc for 2017 but unchanged at 6.3pc for 2018.
The collective growth forecasts in the major industrial economies—the United States, the euro area, and Japan—are revised up to 2.2pc from 2pc for 2017 and to 2.1pc from 2pc for 2018. The upgrade reflects third quarter stronger-than-expected growth in the euro area, supported by domestic demand, and in Japan by private investment and net exports.
Published in Dawn, December 17th, 2017