ADB: Asian Development Review 2020

Developing Asia's GDP growth is -0.7% this year, the first negative growth since the early 1960s. In 2021, growth will increase to 6.8%.

About three-quarters of the region's economies are expected to show negative growth in 2020.

In particular, the GDP outlook of Kazakhstan for 2020 was revised down to -3.2% from the previously outlook -1.2%

"Despite moderate growth in industry and agriculture, the service sector has been seriously affected by the tough measures to contain COVID-19, which led to a decrease in growth in the first half of 2020 by -1.8% year-on-year. Significant fiscal stimulus will also fail to offset the effect of weaker net exports and declining consumer spending and investment", reads the Asian Development Review 2020, prepared by the Asian Development Bank.

Growth forecasts for 2020 have been lowered for all economies in the sub-region, as well as for 2021 for Armenia, Azerbaijan, Kazakhstan and Kyrgyzstan.

The inflation forecast for the sub-region as a whole has been revised up to 8.3%. One of the main reasons for the increase in inflation forecasts is the impact of supply constraints due to quarantine and other restrictive measures that outweigh the effects of reduced demand. Another reason is the depreciation of the national currency in some countries, the ADB explains.

"Most economies in the Asia-Pacific region can look forward to a difficult growth path by the end of 2020", said Yasuyuki Sawada, Chief Economist at ADB. "The economic threat posed by the COVID-19 pandemic remains serious as long first waves or recurring outbreaks may require additional quarantine measures".