Asian Development Bank said that as Asian countries gradually withdrawing from the economic stimulus, economic growth in Asia next year will slow but remain strong.

Asian economic growth will slow

Asia CDB released yesterday, “Asian Economic Outlook” report will be the emerging East Asian economies this year (referring to the 10 ASEAN countries plus China and South Korea) increased to 8.6% economic growth, and China’s economic growth forecast for this year increased to 10.1%. In addition, the bank said that next year the economic growth in emerging East Asian economies will slow but remain strong next year, economic growth in emerging East Asian economies was 7.3%.

The ADB noted that with the economy has shown signs this year, V-recovery in many emerging East Asian economies are currently facing economic growth in developed economies continued weakness, instability in some economies, capital flows, inflation and asset price bubbles, and trade protectionism and other challenges.

The ADB said the slow pace of U.S. economic recovery, European debt crisis is not the end, expect the U.S. economy will grow 2.8% this year, next year will grow by 2.6%; the euro zone economy will grow 1.5% this year, next year will grow by 1.4%.

Guard against inflation risk

Secondary quantitative easing policy for the United States to the global release of a large amount of liquidity, the bank said Asian countries, policy makers need to guard against the risk of high inflation. ADB Office of Regional Economic Integration Ivan Aji Si is the level of inflation in China next year will be further increased.

The ADB noted that the continued strong growth in Asian economies, the currency continues to appreciate, to attract large capital inflows, which to some extent, the Asian countries, pushing the stock and housing prices of assets; In addition, strong demand has resulted in global commodity and food prices rising inflation countries may exceed established goals.

However, the bank warned that, in response to demand pressures and rising asset prices, monetary tightening may be taken only in the short term to attract more capital inflows, increased asset bubble. The bank said the policy should be flexible in the combination of sound macroeconomic management, a flexible exchange rate, flexible financial system and in some cases of targeted capital controls and other measures to fight inflation, promote economic development.

For foreign policy cooperation

May threaten their economies in response to large-scale capital inflows, Asian governments have on national foreign exchange market intervention to prevent currency appreciation of the impact of the economic recovery is too large, a trade war once populations everywhere.

In this regard, the ADB said Asia must seek cooperation in the foreign exchange policy to maintain regional currency stability, balanced economic development of Asian countries and the pace, and to promote investment and trade. Cooperation may include exchange rate stability, the Asian currencies to a basket of currencies or other currencies, to form a single common currency and monetary union of three.

Emerging East Asian countries should strengthen their exchange rate policy coordination to ensure exchange rate stability region. He believes that if the lack of exchange rate coordination mechanism, in the worst cases, triggering currency and trade wars.

If Asian countries uncoordinated exchange rate, volatility of trade within the region will increase, and will slow down the pace of rebalancing the global economy, and the Association of South Asian countries should strengthen cooperation to promote, but the reference to European countries, the exchange rate optimization process, the EU The establishment of the central bank and the euro has come a long way, so that the process of exchange rate coordination in East Asia also need a very long time.

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