ADB says Asia economically dynamic despite crisis

Seoul: Asia will take a substantial hit from slowing demand for its exports as the global downturn unfolds but will remain the world's most economically-dynamic region, an Asian Development Bank economist said on Tuesday.

"The growth rate will decline but Asia will maintain the highest growth in the world, Jong-Hwa Lee, head of the Manila-based development lender's office of regional economic integration, told reporters.

Lee would not reveal the bank's 2009 forecast or for individual countries ahead of their scheduled release early next month.

He said that Asia excluding Japan grew about 9 per cent last year and that there are expectations for about 7.5 per cent growth this year.

Demand worries

"Everyone now understands external demand will decline substantially, not only in (South) Korea but in China and India," Lee said.

"The question is how to strengthen domestic demand and this is the real challenge."

He said countries that can take steps such as cutting interest rates and taxes and increasing money supply and government spending "have some room to increase domestic demand" and "may avoid substantial negative impact from the global slowdown."