Growth in Asia and the Pacific to accelerate to 4.6 percent this year

According to the latest Regional Economic Outlook published by the International Monetary Fund (IMF), the Asia and Pacific region is exhibiting strong resilience amid prevailing challenges faced by policymakers.

The growth rate for this region is expected to increase from 3.8 percent last year to 4.6 percent this year, primarily due to the reopening of China and surging consumption that is boosting regional growth despite weak demand from other parts of the world. However, there are potential risks to this growth outlook, such as spillovers from greater-than-expected US monetary policy tightening and supply chain disruptions caused by geoeconomic fragmentation.

Despite the positive growth projections, the Asia and Pacific region also faces significant challenges. In the near term, policymakers need to maintain tight monetary and fiscal policies to stabilize public debt and bring inflation back to central bank targets. To manage global shocks, an integrated policy response using all available tools will be necessary.

In the longer term, the Chinese economy, which has been a crucial driving force for regional and global growth, is expected to slow down due to unfavorable demographics and a productivity slowdown. To boost long-term growth, the region should prioritize structural reforms, including innovation and digitalization, while accelerating the transition towards green energy.


05/03/2023 4:04 pm