ADB cuts Asean growth forecast

Projected growth for Southeast Asia’s major economies has been cut for this year amid slumps in Vietnam and Indonesia and political unrest in Thailand, the Asian Development Bank (ADB) announced Friday.

In an update to its Asian Development Outlook (ADO) report, the Manila-based multilateral lender said that while the rest of Asia would likely perform as expected, the prospects for Southeast Asia were no longer as rosy.

Growth slowed in Indonesia in the first quarter of the year due to low commodity prices, which meant Southeast Asia’s largest economy earned less for every container of exports it shipped.

Thailand’s economy contracted in the first quarter as the political deadlock affected domestic demand and tourism, while Vietnam’s growth forecast was slightly adjusted to account for the effect of tensions with China on economic activities, including recent factory riots.

The five major economies of the Association of Southeast Asian Nations (Asean-5) are now expected to grow by 4.8 percent in 2014 versus the previous forecast of 5.2 percent. Next year, the forecast was kept at 5.6 percent.

Asean-5 includes Indonesia, Malaysia, Philippines, Thailand and Vietnam. The five countries’ projected growth is slower than the forecast for the rest of Asia of 6.2 percent for 2014 and 6.4 percent for 2015.

Updated individual forecasts for countries were not released. The ADO report released earlier this year showed the Philippines was expected to grow by 6.4 percent this year and 6.7 percent in 2015. Paolo G. Montecillo