According to IMF (International Monetary Fund), it’s a gloomy outlook for major Asian economies as their growth is expected to slow more than expected. IMF released its Regional Economic Outlook report that showed ‘not too good’ numbers for Asia’s growth. According to the report, Asia could moderate to 5 percent in 2019 and 5.1 percent in 2020.
Hong Kong is on the receiving end of this slow growth as month-long protests have badly hit the financial hub’s economy. Based on the report, Hong Kong could just grow 0.3 percent this year and only 1.5% in 2020. The country recently plugged a possible technical recession.
The IMF report revealed that the ongoing protests in Hong Kong not only affects its economy but also threatens the economic stability of other countries.
The outlook for East Asian nation, South Korea, was also negative. The report predicted a 2 percent fall this year and 2.2 percent in 2020.
The slow growth has badly hit the Asian region’s manufacturing sector. Also, Asian investments and trades have weakened significantly, although the region’s domestic demand remains stable. Since 2018, export demands in Asian emerging markets have declined mainly due to weak regional trade, especially in China.
According to the International Monetary Fund, the Chinese economy could grow 5.8 percent next year. That’s lower than the 6.1% forecast in 2019.
Aside from slower than expected growth in China, tensions between South Korea and China over their bilateral relationship also threaten the region.
The IMF report showed that external risks such as the current Brexit turmoil and the ongoing U.S-China trade continue to affect Asian economies badly.
Also read: Oxford Economics: Southeast Asia GDP Going Slow This Year