Asian Development Outlook Supplement, July 2021

Economic Forecasts

ADB is adjusting its 2021 growth outlook for developing Asia as renewed COVID-19 outbreaks, new virus variants, and an uneven vaccine rollout slow the recovery in some economies in the region.

Economic forecasts have since been updated 

Key Messages

Recovery is underway in developing Asia, but the growth projection is revised down slightly from 7.3% in April to 7.2% for 2021 following renewed virus outbreaks in some economies. 2022 forecast is upgraded from 5.3% to 5.4%.

Prospects are still diverging within the region:

  • East Asia’s 2021 growth forecast is raised from 7.4% to 7.5%, reflecting a strong first quarter. Expansion is expected in the People’s Republic of China (PRC) following favorable domestic and external trends.
  • In South Asia, new waves of infections prompt a lower growth forecast of 8.9% for 2021, followed by growth at 7.0% in 2022. India’s 2021 growth projection is downgraded from 11.0% in April to 10.0%, followed by 7.5% growth in 2022.
  • Southeast Asian growth forecast is downgraded from 4.4% to 4.0% in 2021 as some countries reimpose pandemic restrictions, followed by 5.2% growth in 2022.
  • Central Asia’s growth prospects for 2021 are revised up from 3.4% to 3.6%. The Pacific forecast, by contrast, is slashed from 1.4% to 0.3% as Fiji tightens containment measures.
ADB Chief Economist Yasuyuki Sawada

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Recent Developments

Recovery continues to gain momentum in developing Asia, but recent outbreaks of COVID-19, driven in part by new variants, drag on recovery in several economies.

Daily COVID-19 cases in the region peaked at 434,000 in mid-May before falling by three-quarters to 109,000 by the end of June. The latest waves affected many economies in South and Southeast Asia, extending even to Papua New Guinea and Fiji in the Pacific. East Asia, by contrast, has the virus largely under control.

Vaccine rollouts are progressing in many economies, but developing Asia is still far from achieving herd immunity. As of the end of June, the region had administered 41.6 doses per 100 people, slightly above the global average of 39.2 but well below 97.6 in the United States and 81.8 in the European Union.

Vaccination progress varies widely across the region. The PRC and several small economies have managed to administer 50 or more doses per 100 people, but almost half of the region's economies have administered fewer than 15.

Developing Asia Outlook

Even as the pandemic persists, developing Asia is forecast to sustain its strong rebound broadly in line with April forecasts in Asian Development Outlook 2021 (ADO 2021). The regional economy is projected to grow by 7.2% in 2021, slightly lower than 7.3% as envisaged in April, before growing by an upwardly revised 5.4% in 2022.


The 2021 inflation forecast for developing Asia is revised up slightly from 2.3% in ADO 2021 to 2.4% in this Supplement, reflecting higher prices for oil and other commodities, as well as currency depreciation in several Central Asian economies. Inflation is still expected to reach 2.7% in 2022, as envisaged in ADO 2021.

Publication and Links

Asian Development Outlook (ADO) Supplement July 2021 publication cover

Asian Development Outlook (ADO) Supplement, July 2021

The Asian Development Outlook analyzes economic and development issues in developing countries in Asia. This includes forecasting the inflation and gross domestic product growth rates of countries throughout the region, including the People’s Republic of China and India.