Phl, Asean tipped to withstand eurozone, US woes

Manila, Philippines -  The Philippines and other Southeast Asian economies are expected to withstand the impact of the euro zone debt crisis and a sluggish US recovery with healthy growth rates this year and next, the Asian Development Bank (ADB) said.

In its Asian Development Outlook Supplement (ADOS) report, the multilateral financing institution said Southeast Asia’s economies will likely post growth of 5.2 percent in 2012 and 5.6 percent in 2013 while the rest of East Asia is showing signs of buckling under the global economic pressure.

The report said the Philippines is brimming with healthy growth in the first few months of the year, Thailand is on a strong rebound, and Indonesia is experiencing strong consumer demand.

In contrast, the 2012 economic growth outlook of East Asia (including China) was revised from 7.4 percent to 7.1 percent.

For Central Asia, growth outlook was reduced to 6.6 percent from 6.9 percent, and the original growth target of 6.6 percent for South Asia (including India) was revised downward to 6.2 percent.

Overall, the outlook in developing Asia fell to a revised 6.6 percent from 6.9 percent and the earlier 7.3-percent growth outlook fell to 7.1 percent.

“Economic growth in developing Asia moderated during the first half of 2012 as slower growth in the US and euro area reduced demand for the region’s exports,” the ADB report said. “Worries over the economic strength of important developing economies have also emerged recently.”

But the report explained that weak external environment will slow down export growth for Southeast Asia, but private consumption will support robust growth.

“Retail sales have been picking up and consumer confidence remains upbeat, particularly in Indonesia and the Philippines,” the ADB pointed out.

China’s growth will ease to “just” 8.2 percent this year from the original “modest” 8.5 percent, and the robust 9.2 percent in 2011. India’s original growth forecast of seven percent has been revised 6.5 percent.

Overall, growth in the major industrial economies such as the euro zone, Japan and the US, is expected to be below original forecasts.