ADB Forecasts Mild Economic Slowdown for Pacific

Posted March 13th, 2012 at 12:55 am (UTC-5)
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The Asian Development Bank says economic growth in the Pacific region will decline slightly in 2012.

The Manila-based lender says the region's growth will slip by one percentage point from last year's 7.0 percent rate, due to slower growth in resource-exporting economies. The report covers 14 mainly Pacific island countries, including Papua New Guinea and East Timor.

The ADB says the region continues to grow at rates above the global average, and that the ongoing eurozone debt crisis will have only a minimal effect on its economies. Australia and New Zealand, as well as the United States, have a major economic impact on the region, and all have reported their economies grew or recovered in 2011 — a trend that should continue into 2012.

The bank says China's recent downgrading of its 2012 growth target could carry greater implications for the region.

Inflation in the Pacific region is projected to fall from the 8.6 percent posted last year, to 6.6 percent in 2012, as international food prices fall and national currencies rise, making imports cheaper.