IMF Optimistic About Economic Growth in the Asian Region
The International Monetary Fund (IMF) has upgraded its forecast for this year's economic growth in the ASEAN-5 countries (which comprises Indonesia, the Philippines, Malaysia, Thailand and Vietnam) from an initial 5.5 percent to 6.0 percent. Next year, however, the IMF revised down its forecast for the region from 5.7 percent to 5.5 percent. In 2012, ASEAN-5 had experienced 6.1 percent of economic growth, up from 4.5 percent the previous year.
According to the IMF's World Economic Outlook (April 2013) "growth in the ASEAN-5 economies will remain strong at 6 percent in 2013, reflecting resilient domestic demand. A large pipeline of projects under the Economic Transformation Plan will propel strong investment in Malaysia; robust remittance flows and low interest rates should continue to support private consumption and investment in the Philippines; and Indonesia will benefit from a recovery of commodity demand in China. In Thailand, growth is expected to return to a more normal pace after a V-shaped recovery driven by public reconstruction and other flood-related investment in 2012."
While the IMF lowered its forecast for growth in China to 8.0 percent, the institution was more positive about growth in Japan, which it revised up from 0.4 percent to 1.6 percent in 2013 and 1.4 percent in 2014. Cited as reasons for the upgrade were: “after many years of deflation, and little or no growth, the new government has announced a new policy, based on aggressive quantitative easing, a positive inflation target, fiscal stimulus, and structural reforms.”
Stronger growth of Japan's economy is important for Indonesia as Japan - after China - is the second-largest export market for Indonesian commodities and and other products.
IMF Economic Growth Projections:
| 2013 | 2014 |
|
| ASEAN-5 |
6.0% | 5.5% |
| China | 8.0% | 8.2% |
| Japan | 1.6% | 1.4% |