ADB cuts Developing Asia's growth forecast to 4.8 pct '25

TOKYO, Sept 30 (KUNA) -- The Asian Development Bank (ADB) on Tuesday cut its growth forecast for developing Asia to 4.8 percent for 2025 from its earlier projection amid a new global trade environment posed by US tariffs. In an update of its Asian Development Outlook 2025, the Manila-based lender downgraded its April forecast of 4.9 percent growth for this year, and revised down next year's view to 4.5 percent from 4.7 percent. Developing Asia covers 46 economies in Central Asia, East Asia, South Asia, Southeast Asia and the Pacific, but excludes the industrialized countries of Japan, Australia and New Zealand.
"US tariffs have settled at historically high rates and global trade uncertainty remains at elevated levels," said ADB Chief Economist Albert Park in a statement.
"Growth in developing Asia and the Pacific has remained resilient this year thanks to strong exports and robust domestic demand, but the worsened external environment is impacting the outlook. Amid the new global trade environment, it's crucial for governments to continue promoting sound macroeconomic management, openness, and further regional integration," Park said.
The ADB said higher tariffs imposed by the US and elevated trade uncertainty are expected to weigh on the region's growth. "The main risks to developing Asia and the Pacific's outlook include continuing uncertainty around US trade policy, particularly regarding possible sectoral tariffs on semiconductors and pharmaceuticals, as well as unresolved US-China trade negotiations." China's growth prospects for both 2025 and 2026 are 4.7 percent and 4.3 percent, unchanged from April estimates, as policy support is expected to cushion the impact of higher tariffs and continued weakness in the property market, according to the ADB. The bank trimmed its growth forecast for India by 6.5 percent this year and next year from its April forecasts of 6.7 percent and 6.8 percent, respectively. The steep US tariffs levied on Indian exports starting in August are expected to weigh on growth, it explained.
Economies in Southeast Asia are seeing the largest downgrades to growth forecasts amid weaker global demand and elevated trade uncertainty. Growth in the subregion is now projected at 4.3 percent for 2025 and 2026 -- down 0.4 percentage points for each year compared with April's forecasts.
The ADB is a multilateral development finance institution dedicated to reducing poverty in Asia and the Pacific. Established in 1966, it is now owned by 69 members, mostly from the region, as well as the US, Britain and Germany. (end) mk.seo