ADB raises developing Asia 2026 growth forecast to 4.9%

MANILA, July 8 (Reuters) - The ‌Asian Development Bank ​sees ​a slight improvement in the growth outlook for developing Asia and the Pacific this year, though still below earlier projections ‌due to the fallout of the Middle East crisis.

"The Middle East ⁠conflict has led to prolonged disruption to energy and supply chains, raising production costs ‌and dampening economic activity," the ‌ADB said in an update to its Asian Development Outlook report released on Wednesday.

• Growth in developing Asia and the Pacific is projected ​at 4.9% this year, below the ADB's 5.1% forecast in April. However, the revised forecast was an improvement on the 4.7% growth estimate ⁠it issued in late April.

• For 2027, the ADB also raised its growth forecast to 5.1%, ​matching its April estimate, from 4.8% in the late-April update.

• Developing Asia and the Pacific comprises 43 economies, ranging from ​China and India to Georgia and Samoa, ‌but does not include Australia, Japan, New Zealand, Singapore, and South Korea.

• The ADB flagged significant downside risks to ⁠the growth outlook, including renewed escalation of the conflict, prolonged energy market uncertainty, tighter global financial conditions, re-pricing of AI-related stocks, and a deeper property downturn ⁠in China.

• The Manila-based lender painted a mixed growth picture across subregions, forecasting expansion of ​4.6% in East Asia, 6.0% in South Asia and 4.6% in Southeast Asia this year. The projections for East and Southeast Asia were raised from 4.4% and 4.2%, ‌respectively, in the lender's late-April update, while South Asia's forecast was upgraded from 5.7%.

• Inflation in the region ‌is expected to quicken to 4.6% this year, compared with the ADB's 3.6% ⁠forecast in April, but slower ‌than the 5.2% projection ​in late April. Next year, inflation is seen easing to 3.4%.

GDP 20 2025 2026 2027 2026 2027 2026 2027

GROWTH 24

Apr Apr Late Late July July

-Apr -Apr

Caucas 4. 4.6 4.2 4.4 3.8 4.1 3.8 4.2

us and 3

Centra

l and

West

Asia

East 5. 5.0 4.6 4.5 4.4 4.1 4.6 4.5

Asia 0

China 5. 5.0 4.6 4.5 4.6 4.5

0

South 6. 6.8 6.3 6.8 5.7 6.9 6.0 6.7

Asia 4

India 7. 7.6 6.9 7.3 6.6 7.3

1

Southe 4. 4.8 4.7 4.8 4.2 4.1 4.6 4.8

ast 9

Asia

Indone 5. 5.1 5.2 5.2 5.2 5.2

sia 0

Malays 5. 5.2 4.6 4.5 4.6 4.5

ia 1

Myanma -0 -2.2 2.4 2.7 2.4 2.7

r .7

Philip 5. 4.4 4.4 5.5 3.8 5.3

pines 7

Thaila 2. 2.4 1.8 2.0 1.8 2.0

nd 9

Vietna 7. 8.0 7.2 7.0 7.2 7.0

m 1

The 3. 4.2 3.4 3.2 2.8 2.5 3.3 3.2

Pacifi 9

c

Develo 5. 5.4 5.1 5.1 4.7 4.8 4.9 5.1

ping 3

Asia

and

the

Pacifi

c

INFLAT

ION

Caucas 41 25.6 20.6 16.3 22.5 17.1 22.0 16.3

us and .1

Centra

l and

West

Asia

East 0. 0.0 0.6 1.0 1.6 1.5 1.2 0.9

Asia 2

China 0. 0.0 0.6 1.0 1.2 0.9

2

South 6. 2.9 5.0 4.6 7.6 5.7 5.7 4.8

Asia 4

India 4. 2.1 4.5 4.0 5.2 4.0

6

Southe 3. 2.3 3.2 2.8 4.5 3.6 3.9 2.9

ast 0

Asia

Indone 2. 1.9 2.5 2.5 3.0 2.5

sia 3

Malays 1. 1.4 1.8 1.9 2.0 1.9

ia 8

Myanma 29 25.2 24.0 16.0 24.0 16.0

r .6

Philip 3. 1.7 4.0 3.5 5.9 3.9

pines 2

Thaila 0. -0.1 1.3 1.0 2.9 1.3

nd 4

Vietna 3. 3.3 4.0 3.8 4.0 3.8

m 6

The 1. 3.0 4.2 3.5 5.9 3.5 4.2 3.5

Pacifi 7

c

Develo 5. 3.0 3.6 3.4 5.2 4.1 4.3 3.4

ping 3

Asia

and

the

Pacifi

c

(Reporting by Karen Lema; Editing by ‌Martin Petty)

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