Asia's two-speed boom: IMF's new growth map

<p><em>Special Reporting from LSN News, adapted from today's Asia Money Map episode. <a href="https://youtu.be/6cRVj2IH3ek" target="_blank" rel="noopener">Watch the video on YouTube.</a></em></p>

<p>The International Monetary Fund now expects Taiwan's economy to grow 10.7% this year. In April, the Fund forecast 5.2%. Thailand, the host of this week's meetings, gets 2.1%. Same continent, same oil shock, same year: growth in Asia is no longer rising together. It is being sorted.</p>

<h2>An upgrade powered by AI investment</h2>

<p>In its World Economic Outlook, released in Bangkok on Tuesday, the IMF raised its forecast for global growth this year to 3.1%, from 3% in July, CNBC and the Associated Press report. That is still slower than last year's 3.5%. The Fund assumes oil averages about $96 a barrel this year, an increase of nearly 41%, AP reports. It now expects the Strait of Hormuz to reopen only in March next year.</p>

<p>The reason for the upgrade comes down to AI investment. The Fund says spending on chips, data centres and power gave the world a demand impulse that held activity up better than expected. According to Kyodo News, the Fund notes that the capital goods behind that boom come largely from Asia.</p>

<h2>Winners and laggards</h2>

<p>The winners are led by Taiwan at 10.7% and Vietnam at 8.4%. India is forecast to grow 7% this year and next, upgraded on domestic demand and AI-related investment, CNBC reports. Malaysia is at 5.2%, Indonesia at 5.1% and Singapore at 5%. South Korea is at 3.3%, up from 1.1% last year on semiconductor demand. Emerging and developing Asia as a whole is forecast at 5.1%. Kyodo also reports that the Fund expects Korean and Taiwanese chip exports to spill over to other Asian manufacturers.</p>

<p>Then come the laggards. Thailand is forecast at 2.1% this year and next, more than two points below the ASEAN-5 average of 4.4%, Money &amp; Banking Magazine reports. The Philippines, at 3.4%, is held back by imported fuel and expensive food, according to Philstar. Japan, at 0.7%, was nudged up as fiscal support cushions higher energy prices, the Japan Times reports. China is forecast at 4.5% this year and 4% next, down from 5% last year. The IMF says higher oil prices, protracted uncertainty and structural headwinds will weigh on Chinese activity.</p>

<p>The Fund puts it plainly. Growth is not simply slowing or accelerating; it is being reallocated across countries according to their exposure to the war's supply shock and to AI demand. Thirty-two economies now account for 95% of global growth. In April, the figure was 54.</p>

<p>That is the Asia story in one sentence. Economies that build the hardware of AI and can absorb the oil bill are winning. Those that mainly import energy and food are paying.</p>

<h2>A warning inside the good news</h2>

<p>IMF research director Silvana Tenreyro told reporters the world has been resilient, but that this resilience is reaching its limits. The Fund calls the AI boom a large, front-loaded demand shock, arriving before broad productivity gains. It warns that if those gains fail to show up, United States stocks could fall 20%, and the world economy could end up 1.1% below the Fund's baseline by 2028. For Asia, the hit would be 1.7%. The region that gains most from the boom also has the most to lose from a bust.</p>

<p>The Money Map assessment: this outlook is a reward and a risk in the same document. Taiwan, Korea, Vietnam and Malaysia are riding a single demand engine, while Thailand, the Philippines and Japan are fighting an energy bill they cannot control. Asia is no longer one trade. It is two. The policymakers who use this boom to diversify, rather than simply enjoy it, will own the next decade.</p>

<p>What to watch: China's September trade data, due on Wednesday; the rest of this week's Bangkok meetings; oil prices and the timeline for Hormuz; and any sign that AI spending is slowing.</p>

<h2>Sources</h2>

<ul>

<li><a href="https://www.cnbc.com/2026/10/12/imf-world-bank-annual-meetings-october-bangkok-asia-.html" target="_blank" rel="noopener">CNBC, 12/13 Oct 2026</a></li>

<li><a href="https://apnews.com/article/imf-economy-growth-ai-war-oil-23aa01c0c6922fbf0b564a0ff9b2c8e5" target="_blank" rel="noopener">AP, 13 Oct 2026</a></li>

<li><a href="https://data.imf.org/-/media/iData/External-Storage/Documents/C4182C5C54794FC48892DE8F6C74FF82/en/October-2026-WEO-Database-Appendix.pdf" target="_blank" rel="noopener">IMF WEO Statistical Appendix</a></li>

<li><a href="https://focustaiwan.tw/business/202610130005" target="_blank" rel="noopener">Focus Taiwan (CNA), 13 Oct 2026</a></li>

<li><a href="https://www.taiwannews.com.tw/news/6456995" target="_blank" rel="noopener">Taiwan News</a></li>

<li><a href="https://www.philstar.com/business/2026/10/14/2562966/high-food-energy-prices-weigh-philippines-growth" target="_blank" rel="noopener">Philstar, 14 Oct 2026</a></li>

<li><a href="https://businessmirror.com.ph/2026/10/13/imf-sees-robust-recovery-in-27-but/" target="_blank" rel="noopener">BusinessMirror, 13 Oct 2026</a></li>

<li><a href="https://en.moneyandbanking.co.th/2026/277908/" target="_blank" rel="noopener">Money &amp; Banking Magazine (Thailand), Oct 2026</a></li>

<li><a href="https://www.thehawk.in/news/economy-and-business/imf-raises-indias-growth-forecast-to-7-pc-keeps-it-among-fastest-growing-major-economies" target="_blank" rel="noopener">IANS via The Hawk / AsianLite (thehawk.in)</a></li>

<li><a href="https://asianlite.com/2026/top-news/imf-lifts-india-growth-forecast-to-7/" target="_blank" rel="noopener">IANS via The Hawk / AsianLite (asianlite.com)</a></li>

<li><a href="https://english.kyodonews.net/articles/-/87955" target="_blank" rel="noopener">Kyodo News, 13 Oct 2026</a></li>

<li><a href="https://www.japantimes.co.jp/business/2026/10/13/economy/imf-growth-forecast/" target="_blank" rel="noopener">Japan Times (Jiji), 13 Oct 2026</a></li>

<li><a href="https://money.usnews.com/investing/news/articles/2026-10-13/chinas-exports-seen-growing-at-faster-pace-in-september-reuters-poll" target="_blank" rel="noopener">Reuters poll via US News / WTAQ, 13 Oct 2026</a></li>

</ul>