Asian growth strong through 1994: IMF

Asian growth strong through 1994: IMF

WASHINGTON (AFP): Asian economies are expected to show robust growth this year, with China bringing the tendency of its economy to overheat under control, the IMF said in a report released here yesterday.

Asian economies are expected to show average growth of 7.5 percent in 1994, down from 8.4 percent in 1993 but still markedly better than the world forecast of three percent, according to the International Monetary Fund's six-monthly World Economic Outlook report.

Activity in China slowed in the latter part of last year in a bid to contain unsustainably rapid growth, but the country showed 13 percent growth.

This will slow this year, but Beijing is still forecast to show an economic growth rate of 10 percent, maintaining it as the region's fastest-growing economy.

Indonesia's economic growth will likely decline from 6.5 percent last year to 6.2 percent this year.

India performed less well than expected last year, but "an expected revival in investment and the prospect of sustained export growth support the stronger growth forecast for 1994," with growth forecast at 4.8 percent, up from 4.1 percent.

In South Korea, "the outlook is for robust growth, supported by both consumption and investment," while Indonesia, Malaysia, Pakistan and Taiwan remain buoyant, with growth this year forecast at six to eight percent.

Net direct investment and external borrowing in Asia are expected to remain high at US$48 billion, the report said, roughly half the total flow to developing countries. China accounts for more than a third of the total for Asia.

In Japan, there are signs of improvement in confidence in the Japanese economy, but it remains fragile, the IMF said.

"But the fragility of the projected recovery continues to be of concern, as underlined by a significant downward revision of the growth projection for 1994," it said.

The IMF is now projecting growth of 0.7 percent for 1994, down from a forecast of two percent in the last report in October, but rising to 2.3 percent in 1995.

Table

Herewith are the economic growth and inflation in Asian countries as forecast by the IMF.

[Tabulate in 1 col]

GROWTH (gross domestic product):

1993 1994

Asia 8.4% 7.5% China 13.1% 10.0% India 4.1% 4.8% Indonesia 6.5% 6.2% South Korea 5.3% 6.3% Pakistan 5.1% 7.0% Philippines 1.8% 3.5% Taiwan 5.7% 5.8% Thailand 7.8% 8.2% Japan 0.1% 0.7%

INFLATION (consumer prices) Asia 9.5% 7.9% China 13.0% 10.0% India 9.9% 8.5% Indonesia 9.7% 6.0% South Korea 4.8% 4.7% Pakistan 8.7% 7.2% Philippines 7.6% 10.0% Taiwan 2.9% 3.0% Thailand 3.3% 5.0% Japan 1.3% 0.9%