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Asia economies facing shock from war, China slowdown and rate hikes


The Development Bank cut its 2022 growth forecast for the East Asia and Pacific (EAP) region to 5% from 5.4% and warned that growth could drops to 4% if conditions weaken further, traps another 6 million Everyone in poverty.

World Bank says in its latest update on the area.

A higher US rate is likely to trigger capital outflows from developing economies and put pressure on their currencies, thus causing financial tightening “soon,” the World Bank said. ” and hurt growth, the World Bank said.

Meanwhile, the rise of Covid in China, its uncompromising approach to controlling the spread of the virus and trouble in the country’s huge real estate sector could reduce exports in the region.

“Shocks specific to economic activity in China, are also likely to affect EAP countries whose trade is increasingly directed to the Chinese market,” the bank said. speak.

China is seeing its worst spike in Covid-19 cases since the initial outbreak in Wuhan in 2020, and this has led to strict lockdowns in major cities. . Authorities in Shanghai, home to the nation’s financial center and the world’s largest container port, have imposed phased lock over its 25 million residents last week. The curbs have forced shops and restaurants to close, Factory closedand portals to become congestion with ships.
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It added that shocks from the war in Ukraine could affect the region “most specifically” by disrupting goods supplies and increasing financial stress.

“War and sanctions have the potential to increase international food and fuel prices, hurting consumers and growth,” adding that the number of poor people in the Philippines, for example, could increase by 1.1 million if grain prices increase by 10%. five.



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