ASTANA — The Asian Development Bank (ADB) upgraded its revision in growth forecasts for the Caucasus and Central Asia, reaching 4.8% for 2023, up from September’s 4.6% projection in a Dec. 13 Asian Development Outlook (ADO), reported the bank’s press service. Kazakhstan, the largest economy in the sub-region, has played a pivotal role, with growth forecasts increased to 4.5% for 2023 from the previous 4.1% and maintained at 4.3% for 2024.
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Inflation projections for the Caucasus and Central Asia have also been revised upward, standing at 10.9% for 2023, compared to September’s 10.6% forecast. This reflects higher projections for Kazakhstan, with inflation expected to reach 14 % in September 2023 and 8.7% in 2024, up from 12.7% and 7.6%, respectively.
The People’s Republic of China (PRC) and India have emerged as key contributors to the revised growth forecast in Asia. China’s economy is projected to expand by 5.2% this year, exceeding the earlier forecast of 4.9%. India, too, has experienced a growth uptick, with the forecast raised to 6.7% from 6.3%, fueled by double-digit growth in the industrial sector.
However, Southeast Asia faces headwinds, as lackluster performance in the manufacturing sector prompts a downgrade in growth expectations to 4.3% from the initial 4.6% for 2023.
Risks to the overall outlook include persistently elevated interest rates in the United States and other advanced economies, potentially leading to financial instability in vulnerable regional economies, especially those with high debt. Additionally, supply disruptions stemming from the El Niño weather pattern or geopolitical events, such as the Russia-Ukraine conflict, could reignite inflation concerns, particularly in the food and energy sectors.
Established in 1966, the ADB reaffirms its commitment to achieving a prosperous, inclusive, resilient, and sustainable Asia and the Pacific, with a continued focus on eradicating extreme poverty. It is owned by 68 members, with 49 from the region.
