Global institutions forecast slower growth in Asia-Pacific this year, as the Iran war and tariff risks combine to disrupt global trade
Asia-Pacific economies are likely to suffer a slowdown in growth this year, as rising costs linked to the US-Israel war on Iran combine with lingering trade uncertainty to threaten global trade flows, according to forecasts by top international organisations.
“The global economy has, to date, withstood a series of shocks, yet another one – this time a military conflict engulfing the Middle East since the end of February – is testing this resilience,” the report said.
Days earlier, the Asian Development Bank also forecast economic growth in developing Asia and the Pacific to slow this year. It predicted the region would achieve 5.1 per cent growth in 2026, down from 5.4 per cent last year, with economies “weighed down by the conflict in the Middle East and continuing trade uncertainty”.
The lender forecast China’s economic growth at 4.6 per cent this year, down from 5 per cent in 2025.
The World Bank expects East Asia and Pacific regional economic growth to hit 4.2 per cent in 2026, down from 5 per cent last year, “as the energy shock due to the Middle East conflict compounds the adverse impact of elevated trade barriers, global policy uncertainty and domestic economic difficulties”.
It tipped China’s growth to reach 4.2 per cent this year.
Source: News - South China Morning Post
