According to a recent assessment from the Asian Development Bank, China’s economic growth this year will be weaker than that of the rest of emerging Asia for the first time in more than three decades due to COVID lockdowns.
The group lowered its projection for China’s GDP in 2022 from 5.0% in April to 3.3% in a revised Asian Development Outlook study released on Wednesday. The bank also decreased its forecast for the next year from 4.8% to 4.5%. The biggest economy in the area implemented lockdowns as part of its zero-COVID plan to combat epidemics, even as other nations lifted regulations to restart their economies. According to the ADB, these lockdowns contribute to the region’s already existing economic problems.
The main cause of this is Russia’s protracted invasion of Ukraine, which has increased food and fuel prices globally and prompted Western economies to boost interest rates.
A 4.3% growth rate for developing Asia as a whole is predicted for 2022, down from an April estimate of 5.2%. According to the ADB, the region’s anticipated growth, excluding China, is 5.3%.
The growing Asian region is anticipated to grow 4.9% in 2023 rather than 5.3%. However, other areas in the region do have some positive aspects. The prediction for Southeast Asia’s growth for this year has increased from 4.9% to 5.1%, and a 5.0% expansion is anticipated for 2023.
“Developing Asia continues to recover, but risks loom large,” ADB Chief Economist Albert Park said in a statement. “A significant downturn in the world economy would severely undermine demand for the region’s exports,” he said. “Stronger-than-expected monetary tightening in advanced economies could lead to financial instability. And growth in [China] faces challenges from recurrent lockdowns and a weak property sector.”
