The World Bank says East Asian economies will face slower growth in 2009, a prediction that mirrors the institution's forecast for the global economy.
A report issued by the Washington-based bank Wednesday says economic growth in the region, with the exception of Japan, will fall to just over five percent next year, from an expected seven percent this year.
The World Bank says East Asia is better prepared to handle the current economic crisis than other regions in the world, thanks to policies enacted after the 1997 Asian financial crisis. But it says the region is vulnerable to a decline in investment and demand for exports from developed markets.
The bank urges East Asian nations to increase government spending to boost their economies.
The institution issued a report Tuesday saying global economic growth will slow significantly next year, as world trade shrinks for the first time since 1982.
The World Bank projects world trade will fall more than two percent next year, which it says will cause a drop in exports from developing countries.
In a sign of the slowing economy the world's third largest mining company, Rio Tinto, will eliminate 14,000 jobs worldwide in the face of falling demand for metals.
Despite the ongoing bad news, Asian markets are trading higher Wednesday. Investors are buoyed by news of a possible deal between the Bush administration and U.S. Democratic lawmakers on a financial rescue plan for the nation's struggling auto industry.
Some information for this report was provided by AFP, AP and Reuters.
