Currently Limited Negative Impacts of the Russia-Ukraine War

Research Director：Kei-Ichiro INABA

  Chief Forecaster

Deputy Director：Akira TANAKA

  Senior Economist

Asia Forecast Team：Eriko TAKAHASHI

  Senior Economist

Riki KOHANA Trainee Economist

   

2022/03/17

JCER released March 2022 forecast on Asian Economies.

China/ASEAN4 Economic Outlook 

• The year-on-year growth rate of China’s real GDP was 4.0% in Q4 2021, higher than our previous forecast (3.0%) due to two more-than-expected factors – firmly recovered private consumption and buoyant exports to the U.S. The growth rate of China’s real GDP in 2021 turned out to be 8.1%. The Chinese economy is expected to continue growing steadily in and after 2022. Not only because China’s energy self-sufficient ratio is high, but also because importing crude oil and natural gas from Russia is likely to continue working uneventfully in terms of both price and quantity, negative impacts of the sharp rise in global energy prices on China’s economy are expected to be limited. Moreover, the Chinese government appears to nimbly implement effective economic stimulus packages as necessary to underpin the steady growth. The real GDP growth rate is projected to be 5.4% in 2022 and 5.0% in 2023.
• The year-on-year growth rate of ASEAN4’s real GDP was 4.5% in Q4 2021, much higher than our previous forecast (2.5%) due to strongly recovered private consumption in response to the improvement of COVID-19 infection situation. This circumstance is applicable to Indonesia and Malaysia well. The growth rate of ASEAN4’s real GDP in 2021 turned out to be 3.5%. Rapid increases in energy prices will negatively affect private consumption in Thailand and the Philippines whose energy self-sufficient ratios are low. In addition, Russian tourists to ASEAN4 countries will disappear. They accounted for a significant portion of foreign tourists to Thailand especially. Negative impacts of these drawbacks are expected to be limited as far as those on the ASEAN4 economy as a whole are concerned. The real GDP growth rate is projected to be 5.6% in 2022 and 4.4% in 2023.
• The prolongation of the Russia-Ukraine War has the potential to prevent mineral and food resources prices from decreasing, with negative implications for private-sector demand growth in the Chinese and ASEAN4’s economies not only by pushing inflation up but also by distorting the operation of international trade and specialization.

【China/ASEAN4 Economic Outlook】