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(KPL) East Asia and Pacific (EAP) outpaced most regions in economic growth. To sustain this momentum and generate jobs, EAP countries must navigate global uncertainty and tackle long-term challenges tied to shifting global integration, climate change, and demographic trends.
(KPL) East Asia and Pacific (EAP) outpaced most regions in economic growth. To sustain this momentum and generate jobs, EAP countries must navigate global uncertainty and tackle long-term challenges tied to shifting global integration, climate change, and demographic trends.
In its 2025 Regional Economic Update, the World Bank projects that growth in EAP will slow down to 4.0 percent in 2025, compared to 5.0 percent in 2024. Prospects for higher or lower growth depend partly on broader growth prospects, but also on how country policies respond to uncertainty in the global environment. Poverty rates in the region will continue to decline. Around 24 million people in the region are projected to escape poverty between 2024 and 2025, based on the upper-middle-income poverty line.
Growing global uncertainty is having an impact on business and consumer confidence, inhibiting investment and consumption. Trade restrictions are expected to impact EAP’s exports while slower global growth is likely to further reduce external demand.
“While navigating global uncertainty, countries across EAP have the opportunity to strengthen their economic prospects by embracing and investing in new technologies, opening up business opportunities through bolder reforms, and deepening international cooperation," said Manuela V. Ferro, Vice President of the World Bank for East Asia and Pacific.
Growth prospects for countries in the region in 2025 are as follows: China at 4.0 percent; Cambodia at 4.0 percent; Indonesia at 4.7 percent; Malaysia at 3.9 percent; Mongolia at 6.3 percent; the Lao PDR at 3.5 percent; the Philippines at 5.3 percent; Thailand at 1.6 percent; and Viet Nam at 5.8 percent. Growth in the Pacific Island countries is projected at 2.5 percent.
The World Bank suggests a three-pronged policy response. First, harnessing new technologies could boost productivity and as a result could create more jobs, as shown in Malaysia and Thailand. Second, reforms to boost competition, especially in services, could create new economic opportunities, as seen in Vietnam. Third, greater international cooperation can enhance resilience.
“Combining new technologies with bold reform and innovative cooperation could help countries in the region cope with current environment and longer-term challenges.” said World Bank East Asia and Pacific Chief Economist Aaditya Mattoo. “That is the recipe for higher productivity and better jobs.”
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