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Asia-Pacific economy to rebound in 2021, despite COVID

Chinese exports and domestic demand are expected to drive the country's growth figures

Chinese exports and domestic demand are expected to drive the country's growth figures

Asian economies are forecast to grow by 7.3% this year, according to a report by regional lender the Asian Development Bank (ADB).

The positive outlook follows a small economic contraction last year due to the coronavirus pandemic and beat a previous estimate of 6.8% growth.

Key report figures

China's economic rebound is forecast to be the strongest this year with growth at 8.1%. This will be driven by strong domestic demand and exports, the Asian bank said.

It estimates China's economy will slow to 5.5% in 2022.

India's economy will expand by 11% this year, the bank predicted,in line with International Monetary Fund estimates.

The bank said it expects inflation in the region to fall to 2.3% this year from 2.8% in 2020, when disruptions from the pandemic pushed food prices sharply upward in some places.

Looking ahead to 2022, the region's economies — comprised of 45 countries from the Asia-Pacific — are projected to grow 5.3%. Meanwhile, inflation is forecast to rise to 2.7% in 2022.

Threats to growth

Not every country in the region can expect such positive economic news. The ADB forecast that Myanmar's economy will contract nearly 10% this year, after a military coup in February disrupted the country.

This contributed to the trimming of Southeast Asia's 2021 growth forecast to 4.4% from a previous estimate of 5.5%.

The bank warned that new coronavirus outbreaks in several countries, including Thailand, India and the Philippines, threaten the region's growth prospects.

India is in the midst of a severe coronavirus surge that has overwhelmed its healthcare system.

But Yasuyuki Sawada, ADB's chief economist, said that the country's growth forecast was still "achievable" adding that India's vaccine rollout "is going well."

Geopolitical tensions, political turmoil, production bottlenecks, and pandemic-caused school closures also posed threats to the ADB predictions.

kmm/nm (Reuters, AFP)

Updated : 2022-05-29 02:04 GMT+08:00