Oil prices pose risk to East Asia: W Bank

Oil prices pose risk to East Asia: W Bank

SINGAPORE: The sharp rise in crude oil prices is the biggest concern for East Asia's economic prospects with average growth expected to slow to 5.9 percent in 2005 from 7.1 percent this year, the World Bank said on Tuesday.

East Asia, which is a net oil importer, has had to pay an extra US$25 billion so far this year because of higher energy prices and the impact will likely be felt in 2005 as the flow-on effects dampen consumer demand, it said.

Indications that the global economy is already slowing are also likely to weigh down the region, the World Bank said.

"Oil prices, as all of you are aware, have spiked this year and increased about 35 percent on average," Homi Kharas, the World Bank's chief economist for East Asia and the Pacific, said during the release of the organization's twice-yearly outlook for the region. -- AFP