ADB sees crisis hitting Asia growth

[Naveed Yaseen]

LONDON (October 04 2008): Financial crisis in the West will hit Asian growth particularly through manufacturing exports, a top Asian Development Bank official said on Friday, but the continent would continue to outpace other regions even in a global slowdown. ADB Managing Director General Rajat Nag told Reuters that while growth predictions were constantly under review.

Asia would still likely remain the fastest-growing world region even if the developed world slipped into recession, taking an ever larger share of the global economy. "Decoupling is certainly a myth," he said. "What happens in the West certainly affects us. We cannot be complacent but at the same time the time has come for Asia to take a greater role in the world economy. We hope at least one part of the world can continue to provide growth."

He said each 1 percent fall in growth in the G3 economies would likely shave 0.3 to 0.5 percent from Asian growth. But he said Asian policymakers needed to also keep a focus on inflation and could afford to lose some growth to keep price rises under control. Nag said Asian inflation had increased to 7.8 percent in 2008 from just over 5 percent the previous year and that demand was continuing to support prices.

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