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Asian Economy: Overview, Growth & Development

ASIAN ECONOMY: OVERVIEW, GROWTH & DEVELOPMENT
Inflation outlook: research

Inflation projections for developing Asia are revised up a notch from 2.5percent to 2.6percent in both 2019 and 2020, reflecting higher oil prices and several domestic factors. Price fluctuations for Brent crude oil continue amid various concerns affecting both supply and demand. After breaching $60/barrel in January, the price of crude rose to a 5-month high of $74/barrel in late April, after the US ended waivers to its embargo on Iranian exports. In May, oil prices seesawed on news of higher US crude inventory, heightened geopolitical tensions in the Middle East, and worsening fears that trade friction would cause a global economic slowdown. Most recently, an unexpectedly large drop on US crude oil inventories and rising tensions between the US and Iran supported oil prices at the end of June at $64/barrel, still 13percent off from their April peak. Oil price movements will remain contingent on the balance between rising US oil production and the persistence and depth of production cuts led by the Organization of the Petroleum Exporting Countries (OPEC). On 2 July 2019, OPEC and cooperating oil producers agreed to extend oil supply cuts until March 2020. Meanwhile, the US oil rig count, an early indicator of future output, fell to its lowest since February 2018, dipping to 788 in the week ending on 14 June. Barring major supply disruptions, the forecast average price of Brent crude is revised up to $68/ barrel in 2019 and $65/barrel 2020.

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Afghan migrants to Europe could double in 2020

More Afghans than Syrians have migrated to the European Union so far this year, according to official data. The number is expected to double next year.

Turkey’s attack on Kurdish-controlled northeast of Syria has led to expectations of a new wave of asylum seekers from Syria. But EU officials say an increasing number of Afghans poses a more immediate problem, especially in the Greek islands where many of them first arrive.

Since the beginning of the year, nearly 17,000 Afghans have crossed the Aegean sea to reach EU shores, the latest data from the EU border agency Frontex show.

Around half of them had been living in Iran before attempting the crossing through Turkey into the EU, a senior EU official told, adding that in many cases Afghan migrants arriving in Europe were born in Iran.

They are leaving because “the US policy has significantly deteriorated the economic situation in Iran,” the official said. Iran’s economy has been affected by US sanctions imposed last year, causing Afghan workers to leave in search of better ways to support their families still in Afghanistan, according to Iranian officials.

India falls behind Pakistan, Bangladesh, Nepal

India has ranked 102nd among 107 countries in the Global Hunger Index (GHI). In 2018, India had ranked 55 among 77 nations listed in the GHI. South Asian countries like Pakistan (94), Bangladesh (88) and Sri Lanka (66) have fared better than India, says a report prepared by Welthungerhilfe and Concern Worldwide.

India is among 45 countries that have serious levels of hunger. The report says several countries have higher hunger levels now than in 2010, and around 45 countries are set to fail to achieve low levels of hunger by 2030. The GHI report says hunger is the highest in South Asia and Africa South of the Sahara region. “South Asia and Africa South of the Sahara are the regions with the highest 2019 GHI scores, at 29.3 and 28.4 respectively, indicating serious levels of hunger,” says the report.

 

Indonesia must unite in face of economic challenges

President Joko Widodo, who was re-elected in April with a majority vote, has received the backing of his defeated rival Prabowo Subianto, who stressed this week that Indonesia needs to be united to face difficult times ahead, amid rising global economic challenges.

There have been strong signs this past week that Mr Prabowo may join Mr Joko’s ruling coalition after the two met at the presidential palace in the capital last Friday, with Mr Joko admitting later that he had discussed the possibility.

Delhi‘s pollution action plan banning use of diesel generators comes into force

New Delhi banned the use of diesel generators on Tuesday (Oct 15) as pollution levels in the Indian capital exceeded safe limits by more than four times.

Every winter, New Delhi is enveloped in a noxious blanket of smog of car fumes, industrial emissions and smoke from stubble burning at farms outside the megacity of 20 million people.

The ban on generators is part of the Graded Response Action Plan that entered into force on Tuesday.

DPM Heng and Chinese vice-premier Liu he discuss new initiatives

Deputy Prime Minister Heng Swee Keat met Vice-Premier Liu He on Thursday (Oct 17).

Mr Heng and Mr Liu, who is a member of the Political Bureau of the Chinese Communist Party, reviewed the outcomes of the 15th Joint Council for Bilateral Cooperation (JCBC), the highest-level platform for discussions between Singapore and China. Mr Heng co-chaired with Chinese Vice-Premier Han Zheng the JCBC, held in Chongqing on Tuesday.

Malaysia needs to be ready for the worst in South China sea

Malaysia needs to boost its naval capabilities to prepare for possible conflict in the South China Sea, its foreign minister said on Thursday (Oct 17), even as South-east Asia’s third-largest economy pursues non-militarisation of the disputed waterway.

Tensions have escalated in recent weeks, especially after a United States Navy destroyer sailed near islands claimed by China last month as a challenge to what the US Navy described as excessive Chinese territorial claims in the region.

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