ADB downgrades GDP growth forecast for Pacific region

MANILA, July 3 (Xinhua): The Asian Development Bank (ADB) on Thursday downgraded its 2014 gross domestic product (GDP) growth forecast for the Pacific region to 5.2 per cent due to the impact of flooding in Solomon Islands and weak private sector activity in Timor-Leste.
The latest economic growth forecast for Pacific economies is lower than the 5.4 per cent projected in the Asian Development Outlook released by the Manila-based lender last April.
In its "Pacific Economic Monitor" released on Thursday, ADB said economic growth in Solomon Islands will contract by 1 per cent this year, a reversal of the previous GDP growth outlook of 3 per cent.
Solomon Islands was hit by tropical cyclone Ita in April, causing severe damage on agriculture and major public infrastructure.
ADB also cut non-oil GDP growth for Timor-Leste to 8 per cent, from 8.5 per cent projected earlier, due to slower-than-expected credit and consumption growth.
Meanwhile, the Manila-based lender said Pacific countries will face rising challenges in generating needed jobs for their working- age populations in the coming years.
Given the small size and remoteness of many Pacific economies, ADB said Pacific countries should enhance their economies' connectivity and undertake reforms to improve their business environments.