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3w ago

AMRO Holds ASEAN+3 Growth at 4% for 2026–27 as Energy Shock Shifts Risks Lower

The outlook reflects AI‑fueled tech exports facing higher energy costs from the Iran war.

AMRO estimates that Southeast Asia will be the key driver of the region’s economic growth, predicting that ASEAN will grow 4.6% in 2026, and 4.8% in 2027. It estimates that the “plus-three” economies of China, Japan and South Korea will grow 3.8% annually, during the same time period.
A gas station in Seoul on March 31, 2026 (Yonhap)

Overview

  • AMRO's AREO 2026, released Monday in Singapore, keeps the bloc's growth forecast at 4.0% for both 2026 and 2027 and warns that risks have tilted to the downside.
  • AMRO expects regional headline inflation to rise to 1.4% in 2026 after 0.9% in 2025 as higher oil prices feed through to transport, food, and factory costs.
  • South Korea's 2026 growth stays at 1.9%, and its inflation forecast rises to 2.3%, reflecting pressure on a country that imports almost all of its crude oil.
  • Growth is supported by strong AI-driven semiconductor demand, steady investment, and tighter regional supply chains, with ASEAN seen at 4.6% and Vietnam at 7.4% in 2026.
  • AMRO urges flexible policy responses, calling on central banks to safeguard stability and on governments to use targeted fiscal aid to protect vulnerable households.