In its annual examination of the region’s growth prospects, the ADB forecast expansion of 6.3% in both 2015 and 2016, following the same rate of expansion in 2014.
The Asian Development Outlook found that low oil prices were contributing to the region’s expansion, and ADB chief economist Shang-Jin Wei called on countries to make public spending reforms.
‘Falling commodity prices are creating space for policymakers across the region to cut costly fuel subsidies or initiate other structural reforms,’ he said. ‘This is a key opportunity to build frameworks that will support more inclusive and sustainable growth in the longer term.’
The ADB highlighted that Asian countries had contributed nearly 60% of global growth since the financial crisis, with eight countries, including China, Lao and Sri Lanka posting 7% expansion every year since 2009.
Although today’s reportfound growth had slowed in China as the government implements reforms intended to boost domestic demand, stronger growth in India and members of the Association of Southeast Asian Nations would balance this across the region.
According to the forecast, India will overtake China’s annual growth rate, as the government’s economic reforms are boosting investor confidence. India is expected to grow by 7.8% in 2015/16 and 8.2% the following year, compared to forecasts for China of a 7.2% expansion in 2015 and 7.0% in 2016.
