04/10/2013, 00.00
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ADB: China and Indonesia should boost Asian economies

In its 2013 report, the Asian Development Bank expects higher consumption in China and robust expansion in South-East Asia to boost growth elsewhere. Experts warn though against inflation and possible asset bubbles. China is expected to grow by 8.2 per cent against 7.8 in 2012. Myanmar confirmed good development prospects.

Manila (AsiaNews/Agencies) - Rising consumption in China and robust expansion in South-East Asia, fuelled by stronger interregional trade, will boost South-East Asian economies in 2013-2014, with Indonesia expected to lead the region, this according to the 2013 Asian Development Outlook released by the Asian Development Bank (ADB). However, the Manila-based institution sounds a note of caution over inflation, urging governments to watch out for asset bubbles due to strong capital inflows.

The report forecasts a GDP growth rate 6.6 per cent this year and 6.7 per cent next year in Asia's 45 developing economies, against 6.1 per cent last year. At the same time, the bank expects inflation in developing Asia to rise from 3.7 per cent last year to 4 per cent this year and 4.2 per cent next year.

China will remain the driving force behind the trend. Buoyed by consumer spending and strong investments, its economy is projected to expand by 8.2 per cent this year, up from 7.8 per cent in 2012, which had cast some doubts on its future.

In Hong Kong, GDP growth is expected to be 3.5 per cent this year and 3.8 per cent next year.

India should enjoy high growth as well, 6 per cent in current fiscal year and 6.5 per cent in 2014-15 but inflation remains a concern (7.2 per cent in 2013-14, easing back to 6.8 per cent the following year).

The ADB's Outlook also reported positive forecasts for ASEAN economies. The ten-member association should see their combined economy grow 5.4 per cent this year, with estimates of 5.7 per cent in 2014, because of an expected increase in intra-ASEAN trade.

Indonesia's economy should roar, growing by 6.3 per cent and 6.4 per cent in 2013 and 2014 respectively, fuelled by rising private consumption, investments and minimum wages. Exports will accelerate further in 2014, driven by economic recovery in major industrial countries.

Myanmar's economy will also continue to grow, ADB experts say, because of ongoing policy reforms. With its economic opening to world markets, the country will attract investments from developed Western economies.

Its GDP growth was estimated at 6.3 per cent in 2012. This year it should rise to 6.5 per cent and reach 6.7 per cent in 2014. Inflation is expected to average 5.1 per cent in 2013, which is well below recent highs.

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