Asia Poised for Growth after China’s Opening

Asia is expected to benefit from strong economic growth this year after China’s dropping of harsh pandemic curbs. The Asian Development Bank (ADB) predicts that economies in Asia and the Pacific will expand by 4.8% in 2023 and 2024, up from 4.2% last year.

The Manila-based development bank expects that rising consumption, tourism and investment will pave the way for strong recovery after a return to normal following the pandemic.

China’s reopening following the end of its strict “Zero-COVID” strategy is seen as the primary reason for the positive outlook. However, risk factors must be monitored, such as any prolonging of Russia’s war in Ukraine, rising interest rates, and high levels of debt.

China’s economy is slated to grow by 5% this year and 4.5% in 2024, a strong rebound when all risk factors are considered. The ADB also highlighted a strong outlook for India, with growth estimated to hit 6.4% this year and 6.7% next year.

Inflation in Asia is expected to slow to 4.2% in 2023 and 3.3% in 2024, after hitting 4.4% last year. Southeast Asian countries, such as Indonesia, the Philippines and Vietnam, should also register strong growth, driven by tourism and steady domestic demand, with that region’s economy predicted to swell by 4.7% this year and 5% in 2024. Investors with an eye toward Asia will be encouraged by this latest positive outlook.