Developing economies in Asia are expected to grow at a 5.0% annual rate this year, aided by a strong US economy and rising demand for computer chips that fuel artificial intelligence, according to an Asian Development Bank research released on Wednesday. The prediction was raised somewhat higher than the ADB’s April estimate of 4.9% growth. However, the regional lender cautioned of the possibility of more protectionist measures, such as greater taxes on Chinese goods, depending on the outcome of the US presidential election.
The research identified some positive trends, including a comeback in computer chip and other advanced electronics exports from Asia this year as a result of artificial intelligence’s increasing adoption. It also stated that oil and food prices are stabilising, but inflation remains extremely high in countries such as Pakistan, Laos, and Myanmar. The increase in worldwide demand for semiconductors and related electronics materials and components has contributed to stronger growth in Taiwan, Hong Kong, Singapore, and South Korea, as well as, to a lesser extent, the Philippines and Thailand, and this trend is projected to continue. The study referenced World Semiconductor Trade Statistics data, which predicted that spending on memory chips, which are critical for AI applications, would increase 77% this year.
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