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Economy

Emerging Asia to grow 0.1% in 2020, slowest rate since 1961

ADB says 33 economies to shrink as banks renew warning of financial crises

Container ships are shown in Singapore in July 2019.   © Reuters

MANILA -- Developing Asia will barely grow this year as lockdowns imposed to fight the spread of the coronavirus hamper economic expansion, the Asian Development Bank said in a report on Thursday.

The region is expected to grow by 0.1% this year, the slowest rate since 1961 and a further deterioration from the 2.2% projection in April. The ADB said 33 of 46 economies are now expected to shrink, up from nine.

China, the region's largest economy and origin of the coronavirus outbreak, will expand 1.8% this year, down from 2.3% in the April forecast.

"Economies in Asia and the Pacific will continue to feel the blow of the COVID-19 pandemic this year, even as lockdowns are slowly eased and select economic activities restart in a 'new normal' scenario," said ADB Chief Economist Yasuyuki Sawada in a statement.

The Manila-based multilateral lender said it is keeping its 6.2% growth projection for next year, which is still below "what had been envisioned and below pre-crisis trends."

Sawada added, "While we see a higher growth outlook for the region in 2021, this is mainly due to weak numbers this year, and this will not be a V-shaped recovery."

The COVID-19 pandemic may see multiple waves of outbreaks in the coming period, and sovereign debt and financial crises cannot be ruled out, the ADB said, renewing an earlier warning.

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