The Asian Development Bank has cut its growth forecast for the region's developing countries, citing weakness in its two largest economies and concerns over a possible reduction in U.S. stimulus measures.
In its twice-yearly report issued on Tuesday, the bank predicted developing Asia will grow at a rate of 6 percent in 2013, down from its April estimate of 6.6 percent. For 2014, it expects growth will accelerate slightly to 6.2 percent, down from its prior estimate of 6.7 percent.
The Philippines-based lender revised its predictions because of slower growth in China and India. It also cited nervousness over Washington's plans to eventually trim stimulus measures used to boost the American economy from the depths of the 2009 recession.
The report said Asia's emerging markets will be able to deal with the U.S. Federal Reserve's eventual scaling back of the monetary easing policies, noting that most of its economies have healthy current-account surpluses and ample foreign currency reserves.
The bank expects China's economy, the world's second largest, to grow 7.6 percent in 2013 and 7.4 percent in 2014. Those figures are down from its last estimate of 7.7 percent and 7.5 percent, respectively. It said slower growth is the price of more sustainable growth in China, where authorities are moving away from an export- and investment-led economy.
The bank's biggest downward revision on Wednesday was for India; it now predicts India's economic growth will slow to 4.7 percent this year, sharply lower than its last estimate of 6 percent. Its 2014 estimate was revised from 6.5 percent to 5.7 percent. The bank said India's "poor infrastructure and long delays in structural reform keep industry and investment lagging."
The report covers 45 developing or newly industrialized countries in Asia and the Pacific. It excludes Japan.