Weak external demand rom major industrialeconomies and the PRC, however, continues to weighdown the growth prospects or the rest o East Asia. Tiscan be seen in the meager growth in Hong Kong, China;the Republic o Korea; Mongolia; and aipei,China inthe third quarter o 2012. Although slightly higher thanthe second quarter, Hong Kong, China’s economy grew 1.3% year-on-year (y-o-y) in the third quarter, while theRepublic o Korea recorded its slowest growth (1.6%,y-o-y) since the third quarter o 2009. Mongolia, whichhas enjoyed double-digit growth recently, had lower-than-expected growth o 5.6% in the third quarter o 2012. Te external sector in these economies continuedto deteriorate amid global headwinds. ogether,economic growth in East Asia has been revised downslightly rom 6.5% to 6.4% in 2012 and rom 7.1% to 7.0%in 2013.Te uncertain global environment and tightmonetary policies adopted to combat domestic inationcontinue to pressure South Asian economies. Moreover,the late and uneven monsoon will hurt agriculturalproduction in India and Nepal. In Bangladesh, thegrowth projection or FY2013 has been revised downwarddue to decelerating export growth, the result o weak global demand. Domestic demand remains anemic asthe central bank continues tightening monetary policy.In the Maldives, recent political turmoil, growingconcern over the increasing scal decit, rising publicdebt, and the eect o the weaker European economy ontourism point to continued economic ragility.In India, recent economic data suggest that theeconomy remains sluggish. Industrial production(IIP) ell by 0.4% y-o-y in September aer expanding amodest 2.3% in August. Te September IIP contractionwas below market expectations, driven by a decline inmanuacturing. Te July–September national accounts validate this weakness. GDP growth dipped to 5.3% inthe second quarter o FY2012 rom 6.7% in the samequarter during the previous scal year, mainly due topoor output in the arm and manuacturing sectors.Moreover, growth o private consumption expenditurewas one o the lowest in recent years. With weak agricultural income keeping rural consumption low andragile investment sentiment in the coming quarters,GDP growth is now projected at 5.4% or FY2012, below the 5.6% orecast in the
. Growth in FY2013 hasalso been revised down rom 6.7% to 6.5%—as the highdecit and ination coupled with weak capital ows willmake it difcult or the government to cut rates to boostthe economy. Although other economies in South Asiaare relatively resilient, the subregion is now expected togrow more slowly, at 5.3% in 2012 and 6.2% in 2013.Surprisingly, Southeast Asia’s economic growth hasbeen slightly upgraded or 2012 due to stronger-than-expected results through the third quarter o the yearin Malaysia and the Philippines. Malaysia’s domesticdemand continues to be strong, driven by privateconsumption and both private and public investment.Te Philippine economy beat expectations as growthaccelerated to 7.1% in the third quarter, compared with3.2% in the same period last year. Te strong thirdquarter perormance was driven by services supportedby sustained, accelerating growth in industrial output.Private consumption and investment, particularly inconstruction, held up well. Tailand is expecting astrong rebound in the ourth quarter due to the low baseeect rom the impact o last year’s oods. Te othereconomies in the subregion are holding up relatively well, except or Singapore’s open economy. Latesteconomic data point to a sluggish economy, growing0.3% in the third quarter compared with the same periodlast year. Overall growth in Southeast Asia is orecastat 5.3% in 2012 beore edging up to 5.5% in 2013. Te topve ASEAN economies will continue to grow at 5.9% and5.8% in 2012 and 2013.Growth in Central Asia continues to soen.Aggregate growth projections o the subregion arerevised down rom 5.7% to 5.3% in 2012 and rom 6.0%to 5.7% in 2013, aected by difculties in the subregion’stwo largest economies—Azerbaijan and Kazakhstan.In Azerbaijan, lower oil output and unexpected delay
GDP growth, developing Asia (%)201120122013
ADO 2012UpdateRevisedADO 2012UpdateRevised
Central Asia184.108.40.206.5.7East Asia220.127.116.11.7.China, People’s Rep. o 18.104.22.168.8.South Asia22.214.171.124.46.India126.96.36.199.76.5Southeast Asia188.8.131.52.55.5ASEAN 184.108.40.206.75.8The Pacic220.127.116.11.4.
reers to developing member countries o the AsianDevelopment Bank and Brunei Darussalam, an unclassied regional member;
comprises Armenia, Azerbaijan, Georgia, Kazakhstan, the KyrgyzRepublic, Tajikistan, Turkmenistan, and Uzbekistan;
comprises thePeople’s Republic o China; Hong Kong, China; the Republic o Korea; Mongolia,and Taipei,China;
comprises Aghanistan, Bangladesh, Bhutan,India, the Maldives, Nepal, Pakistan, and Sri Lanka;
comprisesthe ASEAN (Indonesia, Malaysia, the Philippines, Thailand, and Viet Nam) plusthe economies o Brunei Darussalam, Cambodia, the Lao People’s DemocraticRepublic, Myanmar, and Singapore; and
comprises Cook Islands, Fiji,Kiribati, the Marshall Islands, the Federated States o Micronesia, Nauru, Papua NewGuinea, Palau, Samoa, Solomon Islands, Timor-Leste, Tonga, Tuvalu, and Vanuatu.
Asian Development Bank. 2012.
Asian Development Outlook 2012 Update
;and staf estimates.