ADB warns of slowing growth in Asian economies

Growth in developing Asian economies was expected to slow slightly over the next two years, reflecting the impact of higher oil prices and rising interest rates, a report by the Asian Development Bank warned.

The Bank said in its latest Annual Development Outlook, published on Wednesday: “Against the backdrop of favourable global conditions, of marginally less accommodative macroeconomic policy settings, and of continued adjustments to high oil prices, aggregate growth is expected to soften a little to 7.2 per cent and by some more in 2007 to 7 per cent.”

“So far developing Asia has been largely resilient to higher oil prices, which rose by 43 per cent in 2005,” said Haruhiko Kuroda, the ADB president.

The report, which covered 43 Asian and Pacific economies including China and India but excluding developed nations such as Japan and Australia, suggested that medium-term growth prospects could be hit by rising unemployment amid continuing population growth.

Financial Times