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BANGKOK (AP) – Trade disputes, rising debt and the potential impact of rising interest rates in the United States are likely to slow growth in the coming year.
The regional lender based in Manila, Philippines, said on Wednesday he hoped economic growth would remain robust at 6.0 percent in 2018, but fall to 5.8 percent next year.
She cited the impending financial and commercial shocks as the main sources of potential problems. If the US economy shows signs of overheating, interest rate hikes by the Federal Reserve could disrupt foreign exchange and other capital markets, leading to bad loan problems.
High housing prices are also risks for China, Hong Kong, Malaysia and South Korea, he added.
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But the biggest threat comes from potential damage to supply chains caused by trade disputes, especially between the United States and China.
President Donald Trump advanced Monday with higher tariffs on Chinese imports of $ 200 billion after
In a dispute arising from complaints filed by the United States, Beijing steals or lobbies foreign companies to surrender the technology. Trump on Monday raised taxes on Chinese imports by $ 200 billion. Beijing fought back by imposing penalties on $ 60 billion worth of US goods.
This measure will likely reduce Chinese growth by 0.5 percentage point and growth by 0.1 percentage point in the United States, according to the report.
She said a further expansion would cause even more difficulties in the region, even if the US trade deficit with China could decrease, the deficit with Asia as a whole would not decrease as much, because other countries will probably export more.
China and the United States had previously imposed tariffs of 25% on $ 50 billion of their respective products. Combined, tariffs now cover nearly half of the goods and services sold by China and nearly 60% of those sold by the United States.
"Prolonged trade conflict can undermine confidence and deter investment," according to the AfDB report. He said the impact would be significant both regionally and globally, especially if it extended to the automotive and automotive industries.
"Impact estimates do not fully account for possible disruptions to production units, as business networks abroad are broken and investment plans canceled as part of a global reallocation of production" adds the report.
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