ADB "Asia Growth Rate This Year Revised Down 0.1%p to 7.1%"... South Korea Maintains 4.0%

After OECD, ADB Also Raises South Korea Inflation Rate Forecast

Source: OECD, Ministry of Economy and Finance

[Sejong=Asia Economy Reporter Son Sun-hee] The Asian Development Bank (ADB) has projected the economic growth rate of 46 Asian countries this year to be 7.1%. This is a further 0.1 percentage point downward revision from the 7.2% forecast made around July, which itself was a downward adjustment from the 7.3% forecast issued in April.

On the 22nd (local time), ADB announced this through the '2021 Asian Development Outlook Update.' The economic forecast covers 46 countries in the Asian region, excluding Japan, Australia, and New Zealand from the total 49 countries.

ADB explained the reason for the downward revision in growth rate by stating, "The emergence of new virus variants and slower-than-expected vaccine rollouts will cause economic growth to be slower than the April forecast."

However, the growth rate for next year remains unchanged at 5.4%.

For South Korea, the growth rate for this year is maintained at 4.0%, and the growth rate for next year is also kept at 3.1%. The government stated, "This is expected to be the result of unexpectedly strong net exports, robust private investment, and recovery in private consumption despite the emergence of new virus variants."

ADB revised South Korea's inflation rate for this year upward to 2.0%, higher than the previous forecasts of 1.3% in April and 1.8% in July. The inflation rate for next year is projected at 1.6%. Earlier, the Organisation for Economic Co-operation and Development (OECD) also released its 'Interim Economic Outlook' report on the 21st, raising South Korea's inflation forecast to 2.2%, up 0.4 percentage points from the May forecast of 1.8%.

ADB stated, "The emergence of new virus variants is a cause of delayed economic recovery in Asia," and advised, "Policymakers should also pay attention to other risk factors such as climate change, natural disasters, and fiscal tightening."