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Asian Development Outlook 2013 Supplement: Firming Industrial Economies to Support Asia’s Outlook

Publication | December 2013
Asian Development Outlook 2013 Supplement: Firming Industrial Economies to Support Asia’s Outlook

An improving growth outlook in Japan and the United States paired with stronger-than-expected performance in the People’s Republic of China support a steady growth outlook for developing countries in Asia.

Developing Asia is set to benefit as further signs emerge of growth momentum in the advanced economies. The region is poised to meet the 2013 and 2014 growth forecasts in Asian Development Outlook 2013 Update, though the subregional contributions to growth have changed.

Key messages

 
  • Infrastructure investments boost the outlook for the People's Republic of China by 0.1 percentage points to 7.7% in 2013 and 7.5% in 2014. This raises the forecast for East Asia as a whole by the same magnitude, as indicators in the subregion's other economies generally align with assumptions in the Update.
  • South Asia is on track to meet growth expectations of 4.7% in 2013 and 5.5% in 2014. After bottoming out in the first fiscal quarter, India's economy seems to have recovered on the back of rebounding exports and higher industrial and agricultural output.
  • Southeast Asia's growth forecast is tempered by 0.1 percentage points in both 2013 and 2014. Typhoon damage will moderate rapid growth in the Philippines before major reconstruction gets under way, and the unfolding political turmoil in Thailand is expected to undermine its growth over the forecast horizon.
  • Inflation forecasts in developing Asia are unchanged amid softer international oil prices and lower global food prices.