Overview

East Asia and Pacific accounts for nearly two-fifths of global economic growth, making it a key driver of growth in the world economy. The region is expected to grow 6.5% in 2016, moderating slightly from 6.8% last year.

Growth in the developing economies of EAP is expected to ease from 6.5% in 2015 to 6.3% over 2016–17. This mainly reflects a moderate slowdown in China. Aggregate growth in the Association of Southeast Asian Nation (ASEAN) economies will be roughly stable at 4.3% in 2015, rising to 4.9% by 2017, with increasing support from global growth and export demand, particularly from high-income economies.

Extreme poverty has declined faster in EAP than in any other region, falling from 80% in 1981 to 4% in 2015. Even with this remarkable progress, however, some 90 million people still live in extreme poverty—and another 300 million are vulnerable to falling back into poverty as a result of climate change, natural disasters, disease, and economic shocks. Economic inequality is high in many countries, even though the incomes of the bottom 40% of the population in most countries have been rising more rapidly than those of the rest of the population. Income inequality partly reflects the inequality of opportunity, including in access to health services and education.

EAP is the epicenter of the double burden of stunting and obesity — both forms of malnutrition. Indonesia, Myanmar, the Philippines, and Vietnam are among a group of 34 countries accounting for 90% of the global burden of stunting. China and Indonesia are among the 10 countries that account for more than 50% of the global burden of obesity.

Stunting significantly reduces the physical and mental capabilities of children, imposing enormous human and economic costs. In Indonesia, for example, where 37% of children are stunted, economic losses associated with stunting are estimated at 2-3% of GDP.

The region includes 13 of the 30 countries that are most vulnerable to climate change. It also bears the brunt of 70% of the world’s natural disasters, which have affected more than 1.6 billion people in the region since 2000. The Pacific Island countries, where the rising sea level is threatening coastal areas and atoll islands, have been hit hard.

EAP is also the largest contributor to greenhouse gas emissions, accounting for one-third of the world’s carbon dioxide emissions and 60% of its coal consumption. The region plays a critical role in advancing the global climate change agenda. To do so, the Bank is working with governments, the private sector, and other development partners on a range of innovative solutions to support greener and cleaner energy policies, including carbon pricing.

Last Updated: Sep 19, 2016

The Bank’s strategy in the region focuses on five priority areas:

  • Inclusion and empowerment;
  • Jobs and private sector–led growth;
  • Governance and institutions;
  • Infrastructure and urbanization;
  • Climate change and disaster risk management.

The Bank also focuses on the cross-cutting themes of gender, fragility and conflict, and poverty analytics.

The Bank approved $7.5 billion for 42 projects in the region this fiscal year 2016 (July 1, 2015 – June 30, 2016). Support included $5.2 billion in IBRD loans and $2.3 billion in IDA commitments. 

Last Updated: Sep 19, 2016

Infrastructure

Lao PDR’s Poverty Reduction Fund (PRF) is the largest multi-sector community-driven development project in the country. The project has benefited more than 680,000 rural poor in about 1,400 villages. In target villages, results include 36% increase in the use of health services, 11% increase in access to safe water resources, and 48% increase in access to all weather roads.

 

Energy

In China, the Eco-Farming Project gave 470,141 households new bio-digesters and improved kitchen, toilets and pig sheds (“1+3” systems”), which significantly improved their health and quality of life. The use of biogas as alternative fuel reduced firewood and coal use and saved cooking time. Households’ disposable income increased as fuel costs, gathering time, cooking time and the quantity of chemical fertilizer and pesticides used were reduced. New water connections were also installed in 155,560 households, and 1771 kilometers of village roads were built, as part of the community development program.

 

Water Supply and Sanitation

In Vietnam, the Coastal Cities Environmental Sanitation Project provided drainage, wastewater collections and treatment plants as well solid waste management facilities in the cities of Dong Hoi, Quy Nhon and Nha Trang. More than 800,000 citizens now enjoy improved solid waste management service, 250,000 have reduced flooding near their homes, 66,500 students have better schools sanitation facilities, and 8,452 poor families had access to a fund to upgrade their toilets. 

 

Transport

The Liaoning Medium Cities Infrastructure Project helped improve existing Chinese urban transport infrastructure to enhance mobility, access and safety, repairing or building a total of 43 roads, increasing the percentage of roads in good condition from 60% to 89% and reducing travel times. The project also built 20 bus-priority lines, 11 bus depots, and 196 bus stations and shelters, also installing 824 traffic monitoring facilities.

 

Jobs

The Rapid Employment Project in Solomon Islands has employed more than 12,000 young people from vulnerable communities, created over 664,000 labor days, provided short-term employment to over 12,000 people and seen young Solomon Islanders build 34 infrastructure projects and support more than 1,200 other community projects throughout the capital of Honiara and other areas. The project is effectively targeting vulnerable groups, including unemployed women and youth, with 60% of the participants being women and 53% being youth between the ages of 16 to 29 years.

Last Updated: Sep 19, 2016

The Bank Group continues to build partnerships with the Association of Southeast Asian Nations (ASEAN), Asia-Pacific Economic Cooperation (APEC), the Pacific Island Forum, Asian Development Bank (ADB), the Australian Department of Foreign Affairs and Trade (DFAT), the Japan International Cooperation Agency (JICA), and others to maximize development impact.

The Bank Group is also working closely with new development banks, such as the Asian Infrastructure Investment Bank (AIIB) to end poverty and boost shared prosperity. In July, the World Bank’s Board of Executive Directors approved the first co-financing project with the AIIB (with $216.5 million from each institution), the National Slum Upgrading Program, to improve infrastructure in Indonesia’s slum areas and benefit more than 9.7 million urban poor across the country.

A key priority for the World Bank’s work in the region is to strengthen knowledge partnerships to deliver solutions for its clients.

For example, in the run-up to Myanmar’s presidential elections last November, a series of policy notes entitled All Aboard: Policies for Shared Prosperity in Myanmar was published to help generate ideas and promote debate on inclusive growth as incoming policymakers prepared to take up their new roles. 

In Vietnam, the completed Vietnam 2035: Toward Prosperity, Creativity, Equity, and Democracy, prepared in collaboration with the government and Vietnamese researchers, lays out a path for Vietnam to reach upper middle income status in 20 years. The report has made an important contribution to the policy debate in Vietnam and could also be useful to other countries going through the same transition.

In China, the World Bank Group worked closely with three government agencies and the World Health Organization to complete a joint report, Deepening Health Reform in China.

The Bank expanded its partnerships with non-borrower member countries this year, opening an office in Kuala Lumpur in March. The new Malaysia office, along with the office in Songdo, Republic of Korea, and the Singapore Global Infrastructure Hub, is intended to generate and share development knowledge, lessons, and solutions with countries in the region and across the globe.

Last Updated: Sep 19, 2016


Economic Update

East Asia and Pacific Economic Update, April 2016

Growth of developing East Asia has remained resilient despite a challenging global environment.





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