Developing Asia will largely maintain its growth momentum in thenext couple o years despite weak global demand. From a moderate7.2% in 2011, growth in the region will ease to 6.9% in 2012 beorepicking up to 7.3% in 2013.Ination or most regional economies subsided in the second hal o 2011 as international commodity price rises slackened, but threats o oil supply disruptions risk urther price spikes. Volatile oreign capitalows remain a concern as investors shit their risk perceptions inresponse to the changing global environment.The greatest risk to the outlook is uncertainty surrounding theresolution o sovereign debt problems in the eurozone. But in theabsence o any sudden shocks, developing Asia can manage the eectson its fnancial markets and trade ows. There is no clear case orpolicy makers in the region to pursue short-term fscal or monetarystimulus measures.Developing Asia has made great strides in raising living standardsand reducing poverty, but swelling income disparities threaten toundermine that success. Regional policy makers need to ensure thatthe benefts o growth are widely shared.