The consequences of the Russian attack on Ukraine are spreading widely.

The Asian Development Bank (ADB) said the countries of Central Asia were also badly affected by the meltdown of the Russian economy.

Their dependence on Russia is enormous.

More than a fifth of Armenia's exports cross the border, while 35 percent of Kazakhstan's imports come from its big neighbor.

"The downturn in Russia will also depress migrant workers' incomes, and the devaluation of the ruble will further reduce the value of their remittances: in Kyrgyzstan, remittances from Russia account for 26 percent of economic output, in Tajikistan 16 percent," said Albert Park, who Chief Economist of the ADB.

He warned of "incredible uncertainties in the global economy".

Christopher Hein

Business correspondent for South Asia/Pacific based in Singapore.

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The Indo-Pacific region is considered the world's growth engine but faces difficulties from the Russian war of aggression in Ukraine.

"The aftermath of the war is an additional hurdle for developing economies in Asia that are still grappling with the pandemic," Park said.

He also warned against a return to coal in view of record oil prices and even more pressure in the semiconductor market: "Key materials come mainly from Ukraine and Russia, they are mainly manufactured in Asia." That could limit production.

For the World Bank, its chief economist for East Asia and the Pacific, Aaditya Matoo, said: "This will be a tough year for the region, nobody will be immune from the shocks." In the region, Mongolia and Thailand are big importers of fuels and Malaysia and Vietnam are ones high export dependency.

The World Bank monitors the countries in East and Southeast Asia, the ADB looks at 45 emerging and developing countries, also in Central and South Asia including India.

The World Bank lowered its previous forecast for the region's growth to just 5 percent;

last October she had assumed 5.4 percent.

According to the World Bankers, even a rate of just 4 percent can no longer be ruled out if conditions continue to deteriorate.

Growth rate was nearly 7 percent

The ADB is reducing its growth expectations to 5.2 percent for the emerging and developing countries in the Indo-Pacific.

The value is higher because the "Bank of the Asians" considers South Asia, which is expected to have strong growth rates.

In the past year of interim recovery, the growth rate was still 6.9 percent.

Next year it should reach 5.3 percent.

Those predictions continued to fall short of the long-term trend, Park said.

Matoo envisioned the bigger picture: “The region is facing a series of shocks that threaten to undermine its growth momentum.” In addition to the political crises in Sri Lanka, Pakistan, Myanmar and Afghanistan, the challenges include the big unknowns such as the trajectory of the pandemic and the slowdown in China's economy.

The consequences of high inflation in America

However, rising prices for natural resources, including oil, coal and wheat, are also becoming dangerous.

They lead to rising inflation in times when low interest rates would actually be welcome in order to heat up the economy and create jobs.

Household income will fall and with it purchasing power.

The economists at the ADB raised their previous forecast for the inflation rate in the region from 2.5 to 3.7 percent.

In the next year, the price increase could then go back to 3.1 percent.

"Persistently high inflation in America could lead to higher-than-expected rate hikes, which could trigger financial volatility, capital outflows and appreciation in the region," Park said.

Both teams of analysts expect a growth rate of 5 percent this year for the region's driving force, China.

Next year it will drop to just 4.8 percent.

In December the World Bank had hoped for 5.4 percent, and in the past year of recovery it was still at 8.1 percent.

The ADB analysts have slashed their forecast for East Asia's growth from 5 percent to 4.7 percent, and for the ten Southeast Asian countries from 5.1 percent to now 4.9 percent.

India should grow 7.5 percent this fiscal year (March 31), with another 8 percent next year.

The development bankers recommend targeted aid for households and companies that have been hit particularly hard, in order to give them room to invest.

Banks and insurance companies should undergo a stress test.

Finally, cross-border trade should be freed from barriers in order to be able to find new ways.

The ADB points out that tax revenue in Asia, at 16 percent of its economic output, was even below the value in Latin America even before Corona.

"Because revenues have plummeted during the pandemic and high spending has been required, there is now an exceedingly urgent need for increased tax revenue," Park said.