The regional economy in East Asia will post slower growth next year because of a slowdown in the US and Europe, and the region could be upset by global market turbulence triggered by US recession jitters, the Asian Development Bank (ADB) said yesterday.
The average GDP growth for East Asian economies would slow to 4.4 percent next year from 4.9 percent this year, according to the Manila-based bank's forecast in its twice-yearly report.
Excluding Japan, the most developed economy in the region, growth for East Asia is projected to fall back to 7 percent from 7.7 percent this year.
"With economic growth in the US and euro zone slowing to a more tempered pace, the external environment facing East Asia in 2007 is likely to be somewhat less supportive of economic growth, but more conducive to containing inflation," the report said.
The bank warned that East Asia could suffer from heightened global market volatility because of worries about the risk of a US slowdown and a sliding US dollar.
A slowdown in the US economy had become a much more threatening prospect compared with earlier in the year, and that could undermine demand for Asian exports, it said.
Uncertainties also hang over China's ability to rein in investment, the bank said.
China's growth is expected to ease to 9.5 percent next year from an estimated 10.4 percent this year.
In Japan, growth is likewise expected to slow down as export growth decelerates.
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