ASIAN economic growth is slowing as demand from crisis-hit Europe declines, the Asia Development Bank (ADB) warned yesterday.
The ADB cut east Asia’s growth forecasts for 2012 to 7.2 per cent, down from 7.5 per cent predicted in September.
“The turmoil emanating from Europe poses a growing danger to trade and finance,” the report stated.
“Asia’s policy-makers must be prepared to act decisively and collectively to counter what could be an extended global economic slowdown.”
Such forecasts are based on expectations that the Eurozone economies will grow by 0.5 per cent in 2012.
If the situation worsens and drags the Eurozone and US into a recession on the scale of that seen in 2009, east Asia’s growth could fall to 5.4 per cent.
China will still lead the region in terms of growth, with GDP expected to expand by 8.8 per cent, down from earlier predictions of 9.1 per cent. Growth of 8.8 per cent compares with 9.3 per cent this year.
However, Asian economies will not be hit as severely as they were in 2009 because they have diversified their export markets, the ADB said.
Exports to Latin America and Africa have increased, while domestic demand has also grown, reducing reliance on western markets.