ADB trims economic growth forecasts for developing Asia

The Asian Development Bank has slightly trimmed its economic growth forecasts for developing Asia this year and next, but said falling oil prices should help economies in the region push through with reforms that could boost growth.

In its update to its 2014 outlook, ADB said yesterday that developing Asia was now expected to grow 6.1 per cent this year, down from its 6.2 per cent forecast in September. Growth next year was seen at 6.2 per cent, down from 6.4 per cent.

"While growth in the first three quarters of this year was somewhat softer than we had expected, declining oil prices may mean an upside surprise in 2015 as most economies are oil importers," ADB chief economist Wei Shangjin said.

The ADB cut its 2014 and 2015 growth forecasts for mainland China to 7.4 per cent and 7.2 per cent, respectively, from the 7.5 per cent and 7.4 per cent estimates made in September, due to falling property prices and the spillover effects on the construction sector.

Reforms brought by Indian Prime Minister Narendra Modi would help his country's economy grow 5.5 per cent this year and, if they were extended, should lift growth to 6.3 per cent next year, the ADB said.

Southeast Asia is expected to grow more slowly than previously thought in 2014 and 2015 due to a slackening in economies in the region. The region is seen growing at 4.4 per cent this year, down from a previous estimate of 4.6 per cent, and 5.1 per cent next year instead of 5.3 per cent.