(Agencies)
Updated: 2007-12-13 19:51

Strong demand from within Asia, particularly China, may be able offset some drag from a likely US slowdown, the report said.

"We think we will be able to dodge the bullet, and that is in part due to very robust domestic demand in Asia, principally from China where import growth is still very strong and domestic demand growth is also very robust," Woo said.

The PECC also cited high energy prices, water pollution and global warming as the top three risks to economic growth in the region.

China's booming growth will slow slightly to 10.5 percent next year from an estimated 11.4 percent this year if government measures to cool the economy begin to take hold, the ADB forecast said.

Economic expansion in the 10-member Association of Southeast Asian Nations will likely slightly moderate to 6.1 percent in 2008, from 6.3 percent this year, the bank said.

But even as growth slows a bit in emerging East Asia, inflation is rearing its head in many economies, it said.

"Slower growth but rising inflationary pressures despite appreciating currencies pose major challenges for the region's policy makers," said Jong-Wha Lee, head of ADB's Office of Regional Economic Integration.

Greater flexibility in exchange rates, a better investment climate and management of capital inflows will help the region support growth, the report said.

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