Skip to Main Navigation



The COVID pandemic, the war in Ukraine, a structural slowdown in China, and financial tightening in the U.S. are having an impact on developing East Asia and Pacific (EAP)’s economic recovery.  Growth is now projected at 5% in 2022, down from 5.4% projected in October. If global conditions worsen and national policy responses are weak, growth could slow to 4%. China’s economy is forecast to expand by 5% in 2022, 0.4 of a percentage point less than forecast in October, and 4% in a low case scenario. The rest of the region is anticipated to expand 4.8% in 2022, 0.4 of a percentage point less than the previous outlook, and 4.2% in a downside scenario. 

The region’s struggling firms, more than 50% of which reported payment arrears in 2021, will be hit by new supply and demand shocks.  Households, some of whom fell back into poverty during the pandemic, will see real incomes shrink further as prices rise.  With debt as a share of GDP increasing by 10 percentage points since 2019, some governments will struggle to provide economic support. Increased inflation, at least 1 percentage point above previous expectations due to the oil price shock alone, will shrink room for monetary easing. 

Despite these challenges, after a slow start on COVID vaccinations, the region has expanded vaccination coverage rapidly. This has allowed for most economies to reopen.  Overall, EAP economies have showed resilience to the pandemic and more recent shocks.  

An unfinished development and growth agenda remains for developing EAP, a region with a population of over 2.1 billion. Rapid urbanization and business demands are feeding a massive need for investment in infrastructure across the region, broadband access, adequate sanitation, reduction and management of marine plastic pollution. Meeting growing electricity needs at a reasonable price and without massively increasing the greenhouse gas (GHG) footprint of EAP is a major challenge. And reducing exposure to climate risks is critical for a region that includes 13 of the world’s 30 most climate-vulnerable countries. EAP 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. Pacific Island countries, where rising sea levels are threatening coastal areas and atoll islands, have been hit hard by natural disasters. 

Last Updated: April 2022 

In Depth

Additional Resources


Washington DC
Marilene Montemayor