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International trade

Economic Growth Forecasts for Asia-Pacific Region Lowered Amid Global Trade Uncertainties

Strategic Insights

— 2 min read

The Asian Development Bank (ADB) has released the "Asian Development Outlook 2025 (July Edition)" report, which forecasts a slightly lower economic growth rate for developing economies in the Asia-Pacific region. The report states that the region's economic growth rate is expected to be 4.7% in 2025 and 4.6% in 2026, which is 0.2 and 0.1 percentage points lower than the previous forecast in April, respectively. The downward adjustment is attributed to factors such as the escalation of US tariffs and global trade uncertainties. However, the ADB maintains its growth forecast for China and believes that the country's economic growth prospects remain stable.

The report also mentioned that India's economy is facing dual pressures of exports and investment due to the US tariff policy. The ADB expects India's economic growth rate to be 6.5% in 2025 and 6.7% in 2026, which is 0.2 and 0.1 percentage points lower than the previous forecast in April, respectively. Southeast Asia is particularly affected by trade uncertainties, with the ADB expecting the region's economic growth rate to be 4.2% and 4.3% in 2025 and 2026, respectively, down 0.5 and 0.4 percentage points from the previous forecast. In contrast, the Caucasus and Central Asia region is expected to see an improvement in its economic outlook due to the expected increase in oil production, with the ADB raising its economic growth forecast for the region by 0.1 percentage point in 2025 and 2026 to 5.5% and 5.1%, respectively.

The report also pointed out that the inflation rate for the Asia-Pacific region is expected to decrease, with the ADB predicting a reduction in inflation rate to 2.0% in 2025, lower than the 2.3% forecast in April, and 2.1% in 2026, lower than the previous forecast of 2.2%. The ADB attributed the lower inflation rate to stabilizing oil prices and strong agricultural output in the region, which will help ease food price pressures.

Key Takeaways:

  • The Asian Development Bank (ADB) has released the "Asian Development Outlook 2025 (July Edition)" report, which forecasts a 4.7% economic growth rate for the Asia-Pacific region in 2025 and 4.6% in 2026.
  • The downward adjustment in economic growth forecasts is mainly due to factors such as the escalation of US tariffs and global trade uncertainties.
  • China's economic growth prospects remain stable, and the ADB maintains its growth forecast for China this year and next year.
  • India's economy is facing dual pressures of exports and investment due to the US tariff policy, with the ADB expecting India's economic growth rate to be 6.5% in 2025 and 6.7% in 2026.
  • Southeast Asia is particularly affected by trade uncertainties, with the ADB expecting the region's economic growth rate to be 4.2% and 4.3% in 2025 and 2026, respectively.
  • The Caucasus and Central Asia region is expected to see an improvement in its economic outlook due to the expected increase in oil production, with the ADB raising its economic growth forecast for the region by 0.1 percentage point in 2025 and 2026 to 5.5% and 5.1%, respectively.
  • The ADB lowered its inflation expectations for the Asia-Pacific region, predicting a 2.0% inflation rate in 2025 and 2.1% in 2026.

Statistics:

  • The Asia-Pacific region's economic growth rate is expected to be 4.7% in 2025 and 4.6% in 2026.
  • The ADB expects India's economic growth rate to be 6.5% in 2025 and 6.7% in 2026.
  • Southeast Asia's economic growth rate is expected to be 4.2% and 4.3% in 2025 and 2026, respectively.
  • The Caucasus and Central Asia region's economic growth forecast is expected to be 5.5% and 5.1% in 2025 and 2026, respectively.
  • The Asia-Pacific region's inflation rate is expected to be 2.0% in 2025 and 2.1% in 2026.

Sources:

  • https://cccme.org.cn/news/details.aspx?id=F90AC40752C61151598239D7142FB4AA&classid=8C92359A9456952E&xgid=F868932F64EB7AAF (In Chinese)

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