Emerging Asia may grow 7.2%<\/p>\n
Agence France-Presse, Manila<\/p>\n
East Asia, excluding Japan, will grow 7.2 percent next year, up
\nfrom 7.1 percent in 2005 on the back of a rise in demand for
\nelectronics products, the Asian Development Bank (ADB) said on
\nMonday.<\/p>\n
The ADB said individual performances are likely to vary
\nsignificantly, with China to slow to slightly below 9.0 percent
\nafter estimated 9.3 percent growth in 2005.<\/p>\n
Excluding China, emerging East Asia is expected to post
\naverage growth of 5.3 percent in 2006, up from 4.6 percent this
\nyear.<\/p>\n
South Korea will likely accelerate to 5.0 percent from 4.0
\npercent in 2005, with Singapore rising to 6.0 percent from 5.2
\npercent.<\/p>\n
\"With (China) a major trading partner for many countries in
\nemerging East Asia, increasing (Chinese) imports should provide
\nadditional impetus for these economies,\" the ADB said.<\/p>\n
China's growth is likely to continue to be driven by strong
\ngains in private consumption while investment will slow but to
\nstill robust levels.<\/p>\n
The ADB said the forecasts are subject to four major risks --
\na disorderly adjustment of growing global payment imbalances, a
\nsharp upturn in the global interest rate cycle, higher oil prices
\nand a possible bird flu pandemic.<\/p>\n
It noted that a continued tightening of monetary policy and
\nfiscal consolidation were needed to sustain strong growth and at
\nthe same time keep inflation in check.<\/p>\n
\"Greater exchange rate flexibility could be utilized more to
\nhelp contain inflation and at the same time rebalance the sources
\nof growth away from exports to domestic demand,\" said Masahiro
\nKawai, head of the ADB's economic monitoring unit.<\/p>\n
The report welcomed the July 2005 shift by China and Malaysia
\nfrom a pegged exchange rate against the U.S. dollar to a managed
\nfloat against a basket of currencies.<\/p>\n
It pointed out, however, that the yuan-dollar exchange rate
\nhas not varied much since the one-time revaluation of the yuan by
\n2.1 percent July 21.<\/p>\n
It said greater flexibility would reduce the need to
\naccumulate foreign exchange reserves and so partly help an
\norderly resolution of global payment imbalances.<\/p>\n
\"Building on the 21 July policy shift, (China) needs to adopt
\ngreater exchange rate flexibility.<\/p>\n
\"There is merit in loosening the yuan's tight link to the U.S.
\ndollar as it would foster greater exchange rate flexibility in
\nAsia as a whole and provide a greater opportunity for collective
\nrate movements vis-a-vis the U.S. dollar,\" the report added.<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/emerging-asia-may-grow-72-1447893297",
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