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MANILA - The Asian Development Bank on Thursday said it is keeping its growth forecast for Asean despite the euro zone crisis and the US economy's sluggish recovery.
In its Asian Development Outlook Supplement, the ADB said the member-economies of the Association of Southeast Asian Nations will grow by a combined 5.6 percent this year, before picking up to 5.9 percent in 2013.
"Despite the weaker external environment, growth in Southeast Asia is expected to remain robust, supported by strong domestic demand and reconstruction in flood-affected areas," the ADB report sad.
"The Asean-5 countries will continue to support growth of the sub-region, accelerating to 5.2 percent in 2012 and 5.6 percent in 2013," the report said.
The Asean-5 include Indonesia, Malaysia, the Philippines, Thailand and Vietnam.
Driving growth in Asean are Thailand's rebound from last year’s floods and the Philippines' robust growth.
The ADB said robust retail sales indicate strong consumer spending particularly in Indonesia and the Philippines.
The lender said most of the governments in Asean have sufficient policy space to ease monetary policy and provide fiscal stimulus if needed.
"While the weaker global environment is expected to affect growth in Southeast Asia, domestic demand and reconstruction activities should keep growth robust," the ADB said.
In contrast, growth should moderate in China and India, the lender said.
It cut its forecast for China to a growth of 8.2 percent this year and 8.5 percent in 2013, and to 6.5 percent and 7.3 percent for India.
The ADB said developing Asia will grow 6.6 percent this year, before rising to 7.1 percent in 2013. These estimates are lower than the 6.9 percent and 7.3 percent forecast for 2012 and 2013 in ADB’s Asian Development Outlook published in April.
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