The Asian Development Bank yesterday cut its growth forecast next year for the region’s developing economies to 7.6 percent, citing tighter credit and soaring food and energy costs.
The bank trimmed its previous growth forecast from April of 7.8 percent, and said actual growth could be lower if either inflation or the US economic slowdown were worse than expected.
It maintained its growth forecast this year for the region at 7.6 percent, with China set to dip below five years of double-digit growth to 9.9 percent this year and 9.7 percent next year.
However, it sharply raised its inflation forecast for East Asia to 6.3 percent this year, from 5.1 percent in its April outlook. Inflation averaged 3.9 percent in East Asia last year. Vietnam would be the worst off with 19.4 percent inflation this year and 10.2 percent next year.
The bank urged a “more decisive tightening of monetary policies” to fight the scourge of inflation and prevent it eating away the fruits of speedy economic growth.
It said many governments were “behind the curve” on the issue and warned the inflation problem was deepening.
“The risk of inaction is rising, and the region’s monetary authorities need to formulate more forceful and preemptive policy responses,” the ADB said.
While economic growth in developing Asia in the first three months of the year was stronger than expected, it eased in the second quarter as slower growth in industrialized nations began to bite, the bank said.
Growth in the industrialized economies of Hong Kong, South Korea, Singapore and Taiwan would slow to 4.7 percent this year amid weaker demand for their exports, before recovering to 4.9 percent next year, the bank said.
Aggregate economic growth in the other large economies of the ASEAN should ease to 5.5 percent this year, with prospects in Indonesia, Malaysia and the Philippines moderating, it said.
The region’s developing nations should weather the storm “relatively well,” the ADB said, adding that central bankers were faced with a dilemma in trying to keep inflation in check without depressing the economy.
“Rapidly rising inflation threatens to dampen consumer spending and risks a wage-price spiral that could derail the region’s recent solid growth,” the bank said.
The CIA has a message for Chinese government officials worried about their place in Chinese President Xi Jinping’s (習近平) government: Come work with us. The agency released two Mandarin-language videos on social media on Thursday inviting disgruntled officials to contact the CIA. The recruitment videos posted on YouTube and X racked up more than 5 million views combined in their first day. The outreach comes as CIA Director John Ratcliffe has vowed to boost the agency’s use of intelligence from human sources and its focus on China, which has recently targeted US officials with its own espionage operations. The videos are “aimed at
STEADFAST FRIEND: The bills encourage increased Taiwan-US engagement and address China’s distortion of UN Resolution 2758 to isolate Taiwan internationally The Presidential Office yesterday thanked the US House of Representatives for unanimously passing two Taiwan-related bills highlighting its solid support for Taiwan’s democracy and global participation, and for deepening bilateral relations. One of the bills, the Taiwan Assurance Implementation Act, requires the US Department of State to periodically review its guidelines for engagement with Taiwan, and report to the US Congress on the guidelines and plans to lift self-imposed limitations on US-Taiwan engagement. The other bill is the Taiwan International Solidarity Act, which clarifies that UN Resolution 2758 does not address the issue of the representation of Taiwan or its people in
US Indo-Pacific Commander Admiral Samuel Paparo on Friday expressed concern over the rate at which China is diversifying its military exercises, the Financial Times (FT) reported on Saturday. “The rates of change on the depth and breadth of their exercises is the one non-linear effect that I’ve seen in the last year that wakes me up at night or keeps me up at night,” Paparo was quoted by FT as saying while attending the annual Sedona Forum at the McCain Institute in Arizona. Paparo also expressed concern over the speed with which China was expanding its military. While the US
SHIFT: Taiwan’s better-than-expected first-quarter GDP and signs of weakness in the US have driven global capital back to emerging markets, the central bank head said The central bank yesterday blamed market speculation for the steep rise in the local currency, and urged exporters and financial institutions to stay calm and stop panic sell-offs to avoid hurting their own profitability. The nation’s top monetary policymaker said that it would step in, if necessary, to maintain order and stability in the foreign exchange market. The remarks came as the NT dollar yesterday closed up NT$0.919 to NT$30.145 against the US dollar in Taipei trading, after rising as high as NT$29.59 in intraday trading. The local currency has surged 5.85 percent against the greenback over the past two sessions, central
RSS