World Bank: Emerging economies in Asia-Pacific to grow at slowest pace in 11 years
Washington, DC, United States (4E) – The World Bank announced on Monday that it is cutting the growth forecast for developing countries in Asia-Pacific for 2012 to 7.2 per cent, lower than the 8.3 per cent posted 2011 because of continued uncertainty in the global economy.
Growth is estimated to ease in developing East Asia excluding India and Japan, according to the Washington-based lender’s report. The latest forecast, which is lower than its 7.6 per cent estimate in May, is the slowest growth rate since 2001.
The report says that gross domestic product would bounce back in 2013 to 7.6 per cent, with domestic demand as the key driver of growth. It warned, however, that major risks persist like the continuing euro zone debt crisis, weak growth in the U.S., and the slowdown in the Chinese economy.
The World Bank said in its report that Asia’s policy makers have enough room to implement fiscal stimulus as China’s slowdown is expected to drag down the overall growth in the region to an 11-year low this year.
The International Monetary Fund (IMF) is also expected to lower its economic growth forecast for the global economy this year during its annual meeting in Tokyo on Tuesday. Europe’s sovereign debt crisis will be on top of the agenda to be discussed by officials of the IMF.
The World Bank stated that the situation in Europe could still worsen despite the efforts of the European Central Bank to defend the euro through its huge bond-buying program.