According to the IMF, Asia grew by 5.7% in 2017. Consumption and investment continue to be the major drivers of Asia growth. Although net exports remained small, the recovery in external demand is also an important driver of Asia GDP growth.
China remains the strongest economy in Asia with a GDP growth rate of 6.9%, a GDP at current prices of USD 12,014 billion and a GDP per capita USD 8,643. Although consumption and investment slowed, the service sector remained the key driver especially in information technology.
Economic performance was also strong in ASEAN economies. Growth rate in Vietnam was equal to 6.8% in 2017 and it was mainly driven by strong exports and accommodative monetary policy. In the same period Cambodia’s growth reached 6.9% supported by higher public spending and robust construction and tourism activity. Lao P.D.R. has also shown a strong growth of 6.8% even if the economy is facing significant macro-financial imbalances.
By focusing on South Asian economies, India is one of the best economic performer even though it has been recovering from the temporary disruptions of November 2016 currency exchange initiative and the rollout of the new Goods and Service Tax. India’s growth rebounded strongly to 6.7% with a GDP per capita equal to USD 1,983 in 2017. India remains the third strongest economy in Asia with a GDP at current prices equal to USD 2,611 billion.
Neighbouring South Asian countries have also performed well economically. Nepal is ranked second in Asia in terms of GDP growth with a rate equal to 7.5%, but it is also characterised by one of the lowest GDP per capita of USD 834. On the other hand, Bangladesh has also a strong 7.1% GDP growth rate with a GDP per capita of USD 1,602, almost double the value of Nepal.
The economic outlook of Asia remains the strongest also for the next years; according to the IMF, Asian economies as China, India, Bangladesh and Lao will grow steadily with similar performance in 2018.
China is expected to grow by 6.6%, while India may surpass the performance 2017 with an expected GDP growth 2018 of 7.4%. Other economies like Bangladesh, Cambodia, Lao and Vietnam will confirm the good performance achieved in 2017 with projected growth rates respectively equal to 7.0%, 6.9%, 6.8% and 6.6%.