The FT reports:

The Asian Development Bank on Tuesday halved its 2009 growth forecast for developing countries in Asia, warning that an anticipated rebound in 2010 was heavily dependent on a broader recovery of the world economy.

The Asian lender said that Asia excluding Japan was likely to grow 3.4 per cent this year, compared with a forecast of 7.2 per cent in September. The region is however expected to rebound in 2010 to growth of 6 per cent.

The forecast revision follows a plunge in exports starting in the fourth quarter. While some Asian countries have recently slowed down the decline in exports, the ADB’s acting chief economist, Lee Jong-Wha, suggested that it was too early to say whether Asia’s slowdown had bottomed out.

The forecast adjustment is not shocking as every other organization has done the same. What is slightly depressing is that the rebound numbers they are talking about are export dependent. This is what got us into this mess in the first place (i.e. in Asia), so if we need strong overseas markets to pull us out, well, that really does depend on a lot of stuff going on outside of Asia. I certainly do not see the EU doing much to boost demand, and attempts by the U.S. seem rather anemic.

Nice to see that the ADB is keeping their eye out for the number one policy issue here over the short to medium term:

Mr Lee also encouraged Asian governments to target more carefully their fiscal stimulus packages to ensure that their economies become more dependent on domestic demand rather than external demand. “This is a crisis but this may also be the opportunity to rebalance our growth and strengthen our domestic demand,” he said.

Couldn’t agree more.