Asian economies will lead world growth in 2015, expanding at a 5.6 percent pace that is level with last year, as recoveries in India and Japan help to offset the slowdown in China, the IMF said in a report Thursday. IMF economists expressed concern, however, over the potential for weaker growth if policy makers in the region fail to follow through with needed changes, saying it was a time not for “alarm but it is a time for alert.”
The IMF’s regional economic outlook forecasts that growth in the Asia-Pacific area will moderate to 5.5 percent in 2016. Asian growth fell to 5.5 percent in 2014 from 5.9 percent in 2013, and is bound to shift lower as China’s economy, the world’s second largest, settles at a more sustainable level than the torrid double-digit pace of the past decade.
China’s report of 7 percent growth in the first quarter of the year was in keeping with that trend. “You cannot expect that a country can keep 10 percent growth forever,” said Changyong Rhee, director of the IMF’s Asia and Pacific Department. “The current phase of growth is in line with our forecasts, but even if it’s a desirable slowdown it can have a negative impact on other countries.”