Asia economy may improve: Bank Negara

Economic performance in Asia is likely to improve this year, driven by domestic demand and the gradual recovery of export demand, said Bank Negara deputy governor Dr Sukhdave Singh.

Speaking in his address at a panel discussion on the Malaysian economy, adding that global inflation was expected to remain moderate in line with the modest improvement in global demand.

Following up on what was released in the central bank’s annual report on Wednesday, Sukhdave said that the prospects of emerging economies remained robust.

According to the report, the International Monetary Fund projects that emerging economies are expected to expand by an average of 6% annually over the next five years.

In Asia, it said growth was increasingly underpinned by the rising strength in domestic demand, which contributed to more than two-thirds of the region’s growth in 2011.

It said the experience from the global financial crisis had provided several crucial insights into the region. For example, weakness in global demand had reinforced the need for ongoing economic reforms in Asia to re-orient growth towards domestic demand.

Sukhdave said the Malaysian economy was expected to remain on a steady growth path with an expansion of 5 per cent to 6 per cent this year on mainly strong domestic demand.