The Asian Development Bank (ADB) is now expecting a slightly less severe contraction in regional economies this year, but warned that output will not catch up with pre-Covid-19 pandemic forecasts until at least 2022.
Developing Asian economies are likely to contract by 0.4pc in 2020, the ADB said in a supplement to its September outlook when it had forecast a 0.7pc decline. Its forecast for 2021 economic growth is maintained at 6.8pc.
Regional powerhouse China is now expected to grow by 2.1pc this year, up from 1.8pc previously, driving an upgrade in the bank's forecast for growth in east Asia to 1.6pc from 1.3pc. This year's economic slump in India is seen as marginally less severe than previously forecast, at 8pc rather than 9pc. But the forecast for southeast Asia this year has been downgraded to a decline of 4.4pc from 3.8pc in September, as coronavirus containment efforts in Indonesia, Malaysia and the Philippines hamper economic activity.
Domestic mobility across the region is slightly below pre-Covid-19 levels, but is down by 10pc in south Asia and 20pc in central and southeast Asia where the virus outbreaks are currently more severe, the bank said.
The ADB's forecasts span central Asia to the Pacific islands, excluding the region's sole developed economy Japan. The US and Japan are the largest shareholders in the Philippines-based bank, which lends to social and economic projects in the region.
