Asia not immune, Kuroda warns

The global financial crisis may force the Asian Development Bank to reduce next year's growth estimates for Asia's economies, ADB President Haruhiko Kuroda said Thursday in Tokyo.

The ADB said in September that Asia's developing economies were likely to grow 7.2 percent in 2009, down from 7.8 percent it forecast in April. But Kuroda's remark suggests further downward revisions will be in store next April, when it makes its forecasts for 2009.

"If the U.S. and European economies slow down as the International Monetary Fund says they will, then we may have to revise downward our forecast for the Asian economy" in 2009, Kuroda said.

In its recent World Economic Outlook, the Washington-based IMF said the industrialized economies will grow 0.5 percent in 2009, down from 1.5 percent projected this year.

Kuroda was optimistic that Asia's financial sector would weather the global crisis.

"As far as this financial turmoil in the U.S. and Europe is concerned, the direct exposure of Asian banks to subprime loans and related assets and their reliance on market funding is limited," he said. "There is very little possibility that another financial crisis in Asia similar to what happened a decade ago will be triggered."