Asian Development Outlook 2013 Supplement: Softening Growth Prospects for Developing Asia
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Continued tepid demand from the major industrial economies coupled with slower growth in the People's Republic of China are weighing on the outlook for developing countries in Asia.
Although advanced economies have largely met expectations so far in 2013, developing Asia has not achieved the momentum envisaged in the Asian Development Outlook. This Supplement trims 0.3 percentage points from the region's growth forecasts, to 6.3% in 2013 and 6.4% in 2014.
- In the People's Republic of China, a weaker-than-expected first half of the year and tighter credit have dampened growth expectations, such that the economy is now forecast to expand by 7.7% in 2013 and 7.5% in 2014.
- In India, slowing fixed capital formation, weak industrial activity, and plodding progress on reform are weighing on the economy, now forecast to expand by 5.8% in 2013. South Asia is paced to grow by 5.6% in 2013 and 6.2% in 2014.
- Southeast Asia's strong start to the year is being tempered by slower growth in the People's Republic of China and continued weak demand from advanced economies for its exports. The five largest economies in the Association of Southeast Asian Nations are poised to grow by 5.2% in 2013 and 5.6% in 2014.
- With softer oil prices and relatively stable food prices, inflation in developing Asia is now forecast to dip to 3.5% in 2013.