East and South Asia continue to post robust economic growth, emerging as key contributors to global stability despite a moderate global growth projection of 2.8% for 2025, says Situation report and the United Nations World Economic Outlook (WESP) 2025.
The report released today highlights the resilience of the global economy, which has withstood multiple shocks, although growth remains below the pre-pandemic average of 3.2%. Persistent challenges such as weak investment, sluggish productivity and high debt levels weigh on the global outlook. However, East and South Asia have emerged as bright spots, driven by strong private consumption, exports and targeted fiscal and monetary policies.
The report mentions that the economic outlook in East Asia remains stable, with the region expected to grow by 4.7% in 2025 and 4.5% in 2026. Low inflation and strong wage growth continue to fueling private consumption, while trade in goods remains a key contributor. Inflation in the region is expected to remain moderate at 1.4% in 2025.
Despite a moderate slowdown, the report said China’s economy remains a key driver, with growth projected at 4.8% in 2025. The country faces challenges such as sluggish household consumption and a weak real estate sector , but the report notes that the government is responding with fiscal and monetary measures to stabilize the economy.
In South Asia, the report said India’s economy is expected to grow by 6.6% in 2025, supported by private consumption, investment and strong export growth in services and manufacturing. The report further mentions that South Asia’s overall growth is expected to be 5.7% in 2025, and countries like Bhutan, Nepal, Pakistan and Sri Lanka will also recover. However, South Asia is not without risks, including slowing external demand, high debt levels and social unrest.
Despite these challenges, both regions are showing resilience, aided by government policies such as fiscal reforms and monetary easing. The report warns, however, that East and South Asia face growing risks from geopolitical tensions, trade disputes and the impacts of climate change, which could exacerbate food insecurity and economic instability. The report also highlights the growing demand for essential minerals, which represents a significant opportunity for many countries in the region to foster growth and increase public revenues, although this demand carries risks linked to poor governance, unsafe work practices and environmental degradation.
