The ongoing weakness in global trade has prompted a slight reduction in the ASEAN growth forecast for 2023, down to 4.5 per cent from the 4.9 per cent projected in April. However, this will be balanced out by improving prospects in the Plus-3 economies.
The ASEAN+3 region is projected to grow 4.6 per cent this year, an increase from 3.2 per cent in 2022, despite global trade challenges.
The ASEAN+3 Macroeconomic Research Office also revised its 2023 inflation forecast to 3 per cent, down from 3.4 per cent.
For 2024, the ASEAN+3 region’s growth is expected to ease slightly to 4.5 per cent.
AMRO has also updated its inflation forecast for 2023 for the region—excluding Lao PDR and Myanmar—to 3 per cent, a slight decrease from the previous prediction of 3.4 per cent. Inflation across most of the ASEAN+3 economies has slowed due to normalising supply chains. As a result, many of the region’s central banks have been able to slow or halt the pace of monetary tightening, which in turn has been boosting consumption, as per the July quarterly update of the 2023 ASEAN+3 Regional Economic Outlook (AREO).
In terms of future outlook, growth is expected to ease slightly to 4.5 per cent in 2024, while inflation is projected to moderate further to 2.4 per cent. There are also positive signs for the region’s export performance.
However, AMRO has warned of potential risks looming. Despite being lower than three months ago, the threat of recession in the US and Europe remains and cannot be fully disregarded.
“ASEAN+3’s recovery is now riding on resilient demand within the region,” said AMRO chief economist, Hoe Ee Khor. “Recovering labour markets and falling inflation are helping to cushion growth against sluggish external demand that is dampening the region’s exports.”
Fibre2Fashion News Desk (DP)