South East Asian economies are expected to continue strong growth despite global uncertainties, according to the ICAEW (Institute of Chartered Accountants in England and Wales) Quarterly Economic Insight Report.

Lower-middle income countries Indonesia, Laos, the Philippines and Vietnam lead the bloc with highest growth rates, expected at 5.4% and 6.1% in 2013 while high income ASEAN countries Singapore and Brunei will have weaker growth owing to greater exposure to global conditions.

The ICAEW report Economic Insight: South East Asia, is produced by Cebr (The Centre for Economics and Business Research), ICAEW’s partner and forecaster. The report undertakes a quarterly review of South East Asian economies, with a focus on the six largest countries; Indonesia, Malaysia, the
Philippines, Singapore, Thailand and Vietnam.

By comparison, the report predicts that the United States will avoid a recession but will take a long time to get back to sustained high economic growth.

The US housing bust has indirectly influenced the Eurozone sovereign debt crisis – exposing weak economies which previously sheltered behind the solid euro. However, though troubles in Europe are expected to have some effect on the ASEAN region, they should not derail the train of prosperity.

“We expect the general world economy to slow thanks to the travails of the West and an easing of Chinese growth,” says Douglas McWilliams, ICAEW chief economic advisor and chief executive of Cebr. “This is likely to have a dampening effect on commodity prices, meaning commodity producers, industrialised economies, and the Asian giants of China and India are predicted to slow in 2012.”

ICAEW believes that ASEAN should keep growing owing to the strength of its domestic demand and growing economic integration, and GDP growth will pick up in 2012, driven by Indonesia which makes up 40% of regional output.

Strong economic growth will bring elevated inflation in its wake, with various factors pointing to structural price increases in the future.