Several shocks set back the global recovery in 2022 (April 2023 World Economic Outlook). Russia’s war in Ukraine &w66nbsp;caused severe commodity price shocks and global trade disruptions. To rein in rising infation, global central banks acted swiftly to raise monetary policy rates, which tightened global fnancial conditions, especially as the US dollar surged. China’s growth slowed markedly as a result of zero-COVID measures and the turmoil in the troubled property sector, falling to rates not seen in more than four decades. These global and regional pressures have afected economies in Asia and the Pacifc signifcantly over the past year. Nonetheless, growth in the region remained resilient in the second half of 2022, much like in the rest of the world.
IMF staf estimate growth in Asia and the Pacifc to have been 3.8 percent for the year as a whole—slower than the strong rebound of 6.5 percent seen in 2021—but to have exceeded previous projections in several of the region’s emerging markets and in some advanced economies in the last two quarters (Figure 1). Strong performance in the third quarter was driven by a recovery in mobility after easing COVID-19 containment measures (Figure 2, panel 1) and strong pent-up demand across the region (Figure 2, panel 2), while external demand from the United States and Europe remained resilient amid fading supply chain disruptions (Figure 2, panel 3). In the fourth quarter, growth momentum continued in many of Asia’s emerging market economies, underpinned by booming service sectors after the reopening (Figure 2, panel 4). Meanwhile, China’s economy avoided a contraction, despite intermittent lockdowns in October and November and the bumpy reopening in December.
