World Bank expects East Asia and Pacific economic growth to slow at 4.5% in 67.
The World Bank forecasts that the East Asia and Pacific economy will experience slower growth, at 4.5% in 2567 and 4.3% in 2568, down from its previous forecast of 5% in 2566.
April 1, 2567 World Bank (World Bank) It was stated that developing countries in East Asia and the Pacific are expected to experience slower growth, facing higher long-term interest rates and geopolitical tensions.
The World Bank stated in its semi-annual outlook that: Gross Domestic Product (GDP) growth for developing countries in East Asia and the Pacific is projected at 4.5% in 2567 and 4.3% in 2568, down from the 5% forecast in 2566. Although most economies in East Asia and the Pacific have grown faster than other countries in the world, growth rates remain slower than before the COVID-19 pandemic.
This is partly due to forecasts of a slowdown in China, where growth is expected to slow to 4.5% and 4.3% in 2567 and 2568, respectively. World Bank specify that "China aims to shift toward a more balanced growth path, but the search for alternative demand drivers proves difficult."
The World Bank says China needs more than traditional fiscal stimulus measures; stronger social protection factors, progressive taxation, and the reallocation of public spending from infrastructure to human capital would help boost consumption.
Excluding China. Developing countries in East Asia and the Pacific are projected to experience continued growth of 4.6% in 2567 and 4.8% in 2568. With export growth projected to recover and financial conditions easing, the Philippines, Vietnam, and Cambodia are projected to grow by more than 5% in 2567 and around 6% in 2568. Thailand and Myanmar lag behind the region's major economies.
“Core inflation in the United States and the European Union remains high, and labor markets remain tight, indicating that interest rates will remain above pre-pandemic levels in the near future.”
While there are negative risks. World Bank I think that "Political developments within various countries, along with escalating geopolitical tensions, are fueling uncertainty."
The World Bank also issued a warning about rapidly increasing debt in the region, which is driving up borrowing costs and stifling both consumption and investment. Corporate debt in China and Vietnam has increased to more than 40% of GDP since 2553, exceeding levels in developed countries. Household debt in China, Malaysia, and Thailand is also higher than household debt in other emerging markets.
In addition Increased trade barriers, largely imposed by developed economies, could negatively impact growth and development in East Asia and the Pacific by limiting access to key markets. For example, the United States, South Korea, and Japan found that nearly 3,000 new trade distortion measures were enforced in 2023, more than three times the number in 2019.
refer : bloomberg.com
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