Growth in developing Asia accelerated in the first quarter of 2024 on resilient domestic demand and strong export growth, particularly in electronics. The region’s growth forecast for 2024 is increased slightly to 5.0%, while the 2025 projection is maintained at 4.9%.
East Asia’s 2024 growth projection is revised up to 4.6% on strong exports of semiconductors and other goods driven by the artificial intelligence boom, with the 2025 projection maintained at 4.2%.
Despite some changes in individual economies, growth forecasts for Southeast Asia remain at 4.6% in 2024 and 4.7% in 2025, and for the Pacific at 3.3% in 2024 and 4.0% in 2025.
The growth forecast for South Asia remains steady at 6.3% for 2024, with the 2025 projection down marginally to 6.5%.
The outlook for growth in the Caucasus and Central Asia is raised to 4.5% from 4.3% in 2024 and 5.1% from 5.0% in 2025.
Headline inflation in developing Asia is now forecast to ease further from 3.3% last year to 2.9% this year, stabilizing at 3.0% in 2025.
Interest rates in the United States and other advanced economies continue to shape the outlook, which is subject to several downside risks. Uncertainty on the United States election outcome, elevated geopolitical tensions and trade fragmentation, property market fragility in the People’s Republic of China, and weather-related events could hurt growth. Meanwhile, La Ni?a is an upside risk due to expected higher rainfall and cooler temperatures.