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ADB cuts Asia growth forecast as Middle East energy shock hits supply chains

ADB lowers Asian growth forecast as energy shock hits PhilippinesAsia growth improves but Asian Development Bank warns of persistent headwinds

The Asian Development Bank reduced its 2026 growth forecast for developing Asia and the Pacific to 4.9% following an energy shock linked to Middle East conflict disruptions.

Lingering supply chain and production cost increases from the regional conflict continue to weigh on Asian economies despite a modest improvement in outlook.

This forecast matters as it signals persistent headwinds for the region's economic trajectory in the face of ongoing geopolitical instability.

  • The Middle East conflict has disrupted shipping routes through the Strait of Hormuz, a critical passage for 30% of global oil trade.
  • Asia accounts for over 60% of the world's manufacturing output, making supply chain disruptions particularly impactful globally.
  • The Asian Development Bank has lost about $12 billion in asset value due to recent geopolitical tensions affecting regional markets.
ADB cuts Asia growth forecast as Middle East energy shock hits supply chains | Implica