Developing Asian economies’ growth expected to be sustained at 4.9pc this year and the next: ADB President

Asian Development Bank (ADB) President Masatsugu Asakawa

Developing Asian economies’ growth expected to be sustained at 4.9% this year and the next, ADB President says ahead of Annual Meeting

The capital city of Georgia on Wednesday warmly welcomed delegates coming from various parts of the world to attend the Asian Development Bank’s (ADB) 57th Annual Meeting.

The meeting opens tomorrow (Thursday) and will examine key development issues facing Asia and the Pacific including climate change, artificial intelligence, and green globalization.

Finance Minister AH Mahmood Ali, who is scheduled to arrive in Tbilisi tonight (Wednesday), will lead the Bangladesh delegation at the meeting, said an official.

In a curtain raiser to the 2024 Annual Meeting, ADB President Masatsugu Asakawa, European Bank for Reconstruction and Development President Odile Renaud-Basso and Georgia Finance Minister Lasha Khutsishvili shared their insights on what it will take to build a sustainable, inclusive future.

Moderated by international journalist Nisha Pillai, the panel discussion focused on the economic landscape, regional cooperation, and how multilateral development banks and countries can collaborate more effectively despite the uncertainties and risks posed by climate change, deglobalization, and geopolitical tensions.

The economies of so-called developing Asia are estimated to have grown at 5.0% last year, 2023, up from 4.3% in the previous year, 2022, Asakawa said.

And this growth momentum is expected to be sustained at around 4.9% this year and next year. On the other hand, inflation has been contained well, he mentioned.

The inflation rate dropped from 4.4% in 2022 to 3.3% in 2023, said the ADB President.

"This robust growth comes from a couple of factors: First, relatively strong domestic demand. Second, recovery of export performance thanks to the favourable semiconductor cycle. Third, very strong remittance inflow to the region. Fourth, a recovery of tourism as more and more tourists are coming back. And fifth, recovery of the Chinese economy," he said.

And talking of the Chinese economy a bit, the ADB President said, China only grew by 3.0% in 2022, but it rebounded to 5.2% growth in 2023, after they exited from a very strict zero-Covid policy.

So looking ahead, he said, the Asia and Pacific economies appear to be very resilient, although they are facing a tremendous amount of uncertainties and challenges.

The ADB President listed four challenges: "One is ongoing geopolitical conflicts in the Middle East and elsewhere. Second, the possibility of very unstable global financial markets due to the monetary policy orientation in advanced economies, especially in the US. Third, the food security issue."
While the food price in general has been declining since its peak in 2022, the rice price has been rising.

And fourth, the downside risk the world is facing is the climate change crisis.

"And actually, it's an uncomfortable truth that the Asia and Pacific region is accountable for more than 50% of CO2 gas emissions, but at the same time it is also true that this region is one of the most vulnerable regions, area vis-Ã -vis natural disasters," he said.

"The meeting will showcase the growing partnership between Georgia and ADB and emphasize Georgia's commitment to regional development and cooperation," said ADB Managing Director General Woochong Um.

"Tbilisi’s location at a crossroads between east and west presents an excellent opportunity to explore the physical, financial, and economic connections between Asia and Europe."

This is the first time Georgia is hosting an Annual Meeting of ADB’s Board of Governors.

The meeting, which runs from 2 to 5 May under the theme “Bridge to the Future”, brings together finance ministers, central bank governors, senior government officials, and representatives from the private sector, academia, media, and civil society from ADB’s 68 members.

Georgia joined ADB in 2007. ADB has committed more than $4 billion to Georgia, becoming one of the country’s largest multilateral development partners.

ADB is committed to achieving a prosperous, inclusive, resilient, and sustainable Asia and the Pacific while sustaining its efforts to eradicate extreme poverty.