East Asia back on recovery track

MANILA: Emerging East Asia has entered the transition from recession to recovery, possibly V-shaped, with gross domestic product (GDP) growth sourced more from domestic stimulus than a resurgence in external demand, the Asian Development Bank (ADB) said yesterday.

Economic growth in emerging East Asia dropped sharply in the first quarter of 2009, but the pace of decline has slowed during the second quarter, ADB said in its latest Asia Economic Monitor, a semiannual review of emerging East Asia's growth and policy issues. The report covers China, South Korea and the 10 members of the Association of Southeast Asian Nations.

In the first quarter of 2009, aggregate GDP growth of major emerging East Asian economies declined to 1.2 percent year-on-year, down from 2.6 percent in the last quarter of 2008 and in sharp contrast to the 8.5-percent growth in the first quarter of last year. Still, despite the global recession, most of the region's economies have performed better during the current economic crisis than during the 1997/98 Asian financial crisis, ADB economists said.