In a supplement to its Asian Development Outlook 2019 Update released in September, ADB now expects gross domestic product (GDP) in the region to expand 5.2 percent in both 2019 and 2020, down from the September forecast of 5.4 percent growth this year and 5.5 percent next year.

In East Asia, growth in China is now expected at 6.1 percent this year and 5.8 percent next year, lower than the forecasts of 6.2 percent and 6.0 percent in September, due to trade tensions and a slowdown in global activity coupled with weaker domestic demand, with family wallets being hit by pork prices that have doubled relative to a year ago. Growth could accelerate, however, should the US and the China come to an agreement on trade, the report says.

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“While growth rates are still solid in developing Asia, persistent trade tensions have taken a toll on the region and are still the biggest risk to the longer-term economic outlook. Domestic investment is also weakening in many countries, as business sentiment has declined,” said ADB Chief Economist Mr. Yasuyuki Sawada.

In South Asia, India’s growth is now seen at a slower 5.1 percent in fiscal year 2019 as the foundering of a major non-banking financial company in 2018 led to a rise in risk aversion in the financial sector and a credit crunch. Also, consumption was affected by slow job growth and rural distress aggravated by a poor harvest. Growth should pick up to 6.5 percent in fiscal year 2020 with supportive policies. In September, ADB forecast India’s GDP to grow 6.5 percent in 2019 and 7.2 percent in 2020.

In Southeast Asia, many countries are seeing continued export declines and weaker investment, and growth forecasts have been downgraded for Singapore and Thailand.

Source: VNA