Global imbalances, dollar accumulations will challenge policy makers

Washington, DC, April 27, 2005 – East Asia’s emerging economies are projected to grow by 6 percent this year, as policy makers face the delicate challenge of responding to a reduced pace of global trade expansion -- especially in electronics -- slowing growth in China, higher oil prices, and large dollar inflows to the region, according to the latest East Asia and Pacific Regional Update, the World Bank’s twice-yearly look at the region’s economies.

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  News Release: East Asia Set to Grow by 6 Percent in 2005   Multimedia: Video interview with the Chief Economist   Past Issues: View reports dating back to 1998

Despite the horrendous loss of life, the Regional Update notes the December 26 tsunami is expected to have a minor impact on overall economic growth in the two most seriously affected East Asian economies, Indonesia and Thailand. Download the report (2mb pdf) The 6 percent forecast growth for emerging East Asia, which includes the tsunami-affected countries, is slightly down from last year’s cyclical peak of 7.2 percent, but should be more sustainable, with balanced contributions from exports, consumer spending, and investment.