According to the Asian Development Bank, Asia’s developing economies are expected to grow by 8% in year 2011. ADB has also predicted that region would expand on solid grounds in next two years. However, this growth rate was bit slower in 2010.
It also said that the only thing which threatens this growth in Asian developing countries is rising inflation, this could also lead to social tensions. The ADB Outlook also said that strong economic links between developing countries could nullify the impact produced due to reduced demand for goods and services in recession-hit rich countries.
Developing Asia which has proved its toughness throughout the global recession is now on the road of recovery and reconsolidation in the two giant countries of the region – China and India. Asia, excluding Japan would grow in 2011 by 7.8% and 7.7% in 2012; as compared to the 9% growth of year 2010 when region was hit by the Global Financial Crises. According to the chief economist of ADB, despite some short term trade disruption, the earth quake disaster in Japan would have a minimal effect on the economic growth of the region as a whole. He added some countries could benefit from the growing demand for construction material by Japan for rebuilding the devastated areas.
China and India would continue to drive region towards global and economic recovery, although on a bit slower pace.
Economic growth in China was expected to reach to the level of 9.6% from 10.3% in 2010 due to tighter monetary policy adopted and also due to slower demand for exports in major markets as US and Europe. India’s economy is expected to expand by 8.2% in the year 2012, down from an expected 8.6% in year 2011.