ASIA'S GROWTH SEEN AT 5%, SARS IMPACT 'MODERATE'
Manila, July 1, 2003 By Edu H. Lopez (BULLETIN) Asia’s economic growth prospects based on gross domestic product (GDP) are projected at around 5 percent for 2003 despite the outbreak of the Severe Acute Respiratory Syndrome (SARS) whose effect on Asian economies is “moderate.”
Asian Development Bank (ADB) President Tadao Chino in a speech delivered at ADB's 36th Annual Meeting of the Board of Governors yesterday said Asia's "robust" performance, compared to other regions, would be based on steady growth in both domestic and export demand in most countries, as well as generally supportive macroeconomic policies.
However, he warned that the economic outlook for 2003 and beyond is highly dependent on global economic movements and is susceptible to risks associated particularly with disruptions in tourism, trade, investment and other services.
The Manila-based bank earlier forecast that the SARS epidemic would shave 0.1-0.2 percentage points off the economic growth of the developing countries in Asia this year, with GDP growth for the 41 economies in the region to decelerate to 5.3 percent in 2003 from 5.7 percent in 2002.
Although SARS is receding, he said the region needs to remain vigilant to prevent its recurrence and ADB recently signed an agreement with the World Health Organization that focuses on the longer-term issues of surveillance and prevention.
Although economic growth is expected to remain strong, Chino stressed that the Asia and Pacific region faces three key challenges:
First, poverty reduction remains the first priority on the global agenda, he said. Over the past year, optimism and hope have been clouded by uncertainties such as heightened geopolitical tensions and persistent threats of terrorism.
Behind the uncertainties, the underlying problems continue to be deprivation, lack of opportunity, inadequate participation, inequity, and a sense of powerlessness - all being dimensions of poverty.
Second, the private sector development is a second critical challenge. ADB has been working with its developing member countries to promote a healthy and vibrant private sector by improving infrastructure - such as transport, communications, energy and water supply - and by supporting policy, institutional, regulatory and judicial reforms that improve governance.
Environmental sustainability is the third major challenge. During the past several months, ADB renewed its commitment to sustainable development at the World Summit for Sustainable Development in Johannesburg, forged an agreement with the Global Environment Facility to address environmental problems in the People's Republic of China and Cambodia, and the Bank played a major role at the recent 3rd World Water Forum in Japan.
Reported by: Sol Jose Vanzi
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