Mobilizing finance for sustained growth

Asia and the Pacific region remains the engine of the global economy. It continues to power trade, investment and jobs the world over. Two-thirds of the region's economies grew faster in 2017 than the previous year, and the trend is expected to continue in 2018. The region's challenge is now to ensure this growth is robust, sustainable and mobilized to provide more financing for development. It is certainly an opportunity to accelerate progress toward achieving the 2030 Agenda for Sustainable Development.

Recent figures estimate economic growth across the region at 5.8 percent in 2017 compared with 5.4 percent in 2016. This reflects growing dynamism amid relatively favorable global economic conditions, underpinned by a revival of demand and steady inflation. Robust domestic consumption and recovering investment and trade all contributed to the 2017 growth trajectory and underpin a stable outlook.

Risks and challenges nevertheless remain. Rising private and corporate debt, particularly in China and countries in Southeast Asia, low or declining foreign exchange reserves in a few South Asian economies, and trends in oil prices are among the chief concerns. Policy simulation for 18 countries suggests a $10 rise in the price of oil per barrel could dampen GDP growth by 0.14 to 0.4 percent, widen external current account deficits by 0.5 to 1.0 percentage points and build inflationary pressures in oil-importing economies. Oil exporters, however, would see a positive impact.