The Asian economy faced “strong headwinds” in early 2015, according to the Asian Development Bank’s September Asian Economic Outlook report. Growth figures for the region are predicted to slow from 6.2 percent in 2014, down to 5.8 percent in 2015 before seeing a slight rebound to six percent in 2016.
Southeast Asian economies also saw their
The estimate for 2015 is a revision downwards of the bank’s March Asian Economic Outlook figures, which forecasts growth at 6.3 percent for the year. The reasons for this slowdown are numerous. A delayed recovery in the major industrial economies such as the US and Japan has played a role, with the former facing a particularly harsh winter at the start of the year along with labour disputes at the ports of the West Coast – while the latter saw an unexpectedly weak recovery of consumption and investment. At the same time the large economies of the region underperformed. China saw export growth falter, while India saw investors defer their decisions pending government action on structural reforms.
In China, “growth is forecast to slow from 7.3 percent in 2014 to 6.8 percent in 2015,” and expected to fall further to 6.7 percent by in 2016. East Asia as a whole is expected to expand by only six percent in both 2015 and 2016, a considerable slowdown from 6.5 percent in 2014
However, while Indian growth has been more moderate than expected, the South Asian region itself is set to see reasonable levels of growth. As the report notes: “Growth in South Asia is now projected at 6.9% in 2015, below the 7.2 percent March forecast but up from 6.7% in 2014. Growth is forecast to rise further to 7.3 percent in 2016.”
Southeast Asian economies also saw their recovery delayed. Although growth in Vietnam has been particularly strong, other Southeast Asian economies has held the regions collective growth back, with export demand dampened by subdued demand in the major industrial economies and China. At the same time, the report notes, “planned infrastructure investment has fallen behind schedule in Indonesia and the Philippines, and Thailand’s recovery to date has been sluggish.” The region’s growth is expected to be 4.4 percent in 2015, the same pace as in 2014.
Despite a moderation in growth figures for much of the Asian economy, the region itself is still one of the main contributors to global economic growth.