The annual Asian Development Outlook provides
a comprehensive economic analysis of 42 economies in developing Asia and
the Pacific. On the basis of the Asian Development Bank’s unique knowledge
of the region, this 17th edition overviews aggregate trends and medium-term
prospects by subregion - East Asia, Southeast Asia, South Asia, Central
Asia, and the Pacific - in the context of global economic movements.
The region’s developing economies achieved their strongest performance
in 2004 since the Asian financial crisis of 1997–98. Aggregate gross domestic
product for the region expanded by a remarkable 7.3%. Growth was underpinned
by a combination of sustained external demand and generally buoyant domestic
demand. Spurred by a robust expansion in major industrial countries, continued
strong growth in the People’s Republic of China and deepening regional
integration, exports from regional countries surged.
In spite of some moderation of growth among the major industrial countries
over the forecast period 2005–2007, the baseline projection is for a continued
robust economic performance. But widening growth gaps among these economies
cast a shadow on the medium-term sustainability of the current expansion
by exacerbating global economic imbalances. A jump in interest rates,
instability in currency markets, high oil prices, and the outbreak of
epidemics remain significant risks to the region.
This issue of the Asian Development Outlook includes a chapter
on promoting competition for long-term development in Asia. Restrictions
to competition should be removed to enable markets to deliver the benefits
of competition both to consumers and to sustainable economic growth. However,
competition must sometimes be accompanied by regulation to inhibit firms'
use of anticompetitive practices. In addition, competition complements
intellectual property protection as both seek to promote innovation and
enhance consumer welfare. The key message is that government policy should
promote competition to ensure efficient resource allocation, while preserving
incentives for innovation.
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