Emerging Asia to grow 4.2% in ’09; to pick up speed in ’10 - ADB

15 December 2009 04:34  [Source: ICIS news]

SINGAPORE (ICIS news)--Asia’s emerging economies will grow faster than initially expected this year and expansion should gather speed in 2010, thanks to the quick policy responses from various governments across the region, the Asian Development Bank said on Tuesday.

In its Asia Economic Monitor report, the multilateral institution said the region would post a 4.2% growth this year, up from its earlier forecast of 3.6%. The ADB also adjusted up its growth expectations for 2010 to 6.8% from 6.5%.

“Emerging East Asia is rebounding strongly and growth rates next year are likely to slightly outpace 2008 in most countries,” said Jong-Wha Lee, chief economist and head of the office of regional economic integration at the ADB.

Emerging Asia comprises the 10 economies of the Association of Southeast Asian Nations (ASEAN) plus China, Taiwan, Hong Kong and South Korea.

For developing Asia, which comprises 45 members of the ADB, economic expansion would be 4.5% in 2009 and grow at a faster rate of 6.6% in 2010, the ADB said.

A stronger economic growth would mean better demand for petrochemicals into next year.

China, the third biggest economy in the world, which played a key role in revving up demand for petrochemicals this year, was projected to post an 8.2% growth this year and an 8.9% growth in 2010, the ADB said.

“[China’s] economic growth remained robust throughout the global crisis as huge fiscal and monetary stimulus sustained investment and consumption,” the ADB report said.

Regional governments must keep their fiscal and monetary policies accommodative to ensure their economies get back on a sound footing, Lee said.

“A key challenge for each economy will be to carefully time when best to roll back the stimulus to ensure sustained recovery but avoid both excessive inflation and hefty fiscal shortfalls,” he said.

Read John Richardson and Malini Hariharan's Asian Chemical Connections blog
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By: Pearl Bantillo
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