ADB sees wider growth gap in developing Asia on El Nino, AI

The Asian Development Bank projects the gap in growth rates among Asia's developing economies to widen this year. Countries such as the Philippines and Cambodia are bearing more of the impact from the energy crisis and a strong El Nino, while India, Malaysia and Vietnam are gaining from an AI-driven export boost. In its latest economic outlook, published Sept. 23, the ADB said "likely very strong" El Nino effects this year could pose serious risks to agricultural production in the region.

Written by AI from Nikkei Asia · not yet reviewed by an editor · Published 23 Sept 2026, 12:38 pm IST

Source

Nikkei Asia · read the original report ↗

#adb#el nino#economic growth#ai exports#asia economy

Desk check · compared with the source

What the desk checked (4)

ADB's latest economic outlook, published Sept. 23, says 'likely very strong' El Nino effects this year could pose serious risks to regional agricultural production. — Directly attributed to the ADB report and quoted in the source.
The growth gap among Asia's developing economies is projected to widen this year. — Attributed to ADB projections in the source; no specific figures provided.
The Philippines and Cambodia are bearing more of the impact from the energy crisis and a strong El Nino. — Appears in source as ADB's assessment; no supporting data given in the excerpt.
India, Malaysia and Vietnam are getting an AI-driven export boost. — Stated in the source headline and text; no figures cited.

Written by AI from Nikkei Asia · not yet reviewed by an editor · How we use AI · Report an error

Analysts’ view opinion

AI Economic Analyst

The ADB is describing one region running two different economies. On one side sit India, Malaysia and Vietnam, plugged into AI-driven tech export demand; on the other, the Philippines and Cambodia, absorbing the energy crisis and a strong El Nino. The split is largely about export composition: economies leaning on agriculture and imported fuel face price pressure and lost output, while those inside electronics and semiconductor supply chains capture the upside.

If El Nino cuts harvests, the first visible effect is food-price inflation, which squeezes household purchasing power and narrows the room for central banks to cut rates.
Fuel-import-dependent economies risk a simultaneous hit to trade balances, currencies and subsidy bills — meaning the cost ultimately lands on the public budget or the consumer.
An AI-led export boost concentrates the gains in tech and electronics clusters through jobs and investment, while farm and rural livelihoods see little of it.
A wider growth gap tends to split capital flows and borrowing costs too: cheaper funding for strong exporters, pricier debt for the strained economies.
The weather shock may prove temporary, but AI-linked demand is itself cyclical — neither guarantees durable structural growth.

What to watch — Watch coming food-inflation prints and fuel-import bills against electronics export growth — those numbers will show how wide the gap actually gets.

The story does not give ADB's actual growth figures, the size of the country-by-country divergence, or any quantified El Nino damage — these remain projections, not outcomes.

Deep dive

Research brief · 7 facts · 2 dates · exam-ready

The brief

Context

The Asian Development Bank's latest economic outlook, published Sept. 23, projects that growth rates across Asia's developing economies will diverge more sharply this year. Some economies, including the Philippines and Cambodia, are absorbing more of the damage from an energy crisis and a strong El Nino weather event, while India, Malaysia and Vietnam are being lifted by an AI-driven boost to technology exports. The ADB warns that "likely very strong" El Nino effects this year could pose serious risks to agricultural production in the region. The report was datelined from Manila, where the ADB is headquartered.

Key facts

The Asian Development Bank published its latest economic outlook on Sept. 23, according to the source.
The ADB projects the gap in growth rates among Asia's developing economies to widen this year.
The Philippines and Cambodia are described as bearing more of the brunt of the energy crisis and a strong El Nino.
India, Malaysia and Vietnam are cited as gaining from an AI-driven export boost.
The ADB said "likely very strong" El Nino effects this year could pose serious risks to agricultural production in the region.
The report's dateline is Manila; specific growth-rate projections are not stated in the source.
A photograph accompanying the report shows a parched rice field in Candaba, Pampanga province, Philippines, in 2024.

Timeline

2024A parched rice field is photographed in Candaba, Pampanga province, Philippines, illustrating drought stress on agriculture.
Sept. 23The ADB publishes its latest economic outlook, warning of "likely very strong" El Nino effects and a widening growth gap in developing Asia.

Who has a stake

Asian Development Bank (ADB) — Multilateral lender that produces the outlook and forecasts growth divergence and climate risks for developing Asia.
Philippines — Named as bearing more of the impact of the energy crisis and a strong El Nino; agricultural output at risk.
Cambodia — Also flagged as absorbing more of the energy crisis and El Nino shocks.
India, Malaysia and Vietnam — Benefiting from an AI-driven boost to exports, supporting faster growth than peers.
Farmers and agricultural producers in the region — Face serious production risks if El Nino effects turn out "likely very strong" as the ADB warns.
Energy importers and consumers in developing Asia — Exposed to the energy crisis that the ADB links to weaker performance in some economies.

Why it matters

A widening growth gap means the benefits of the current technology and AI export cycle are not spread evenly across developing Asia, rewarding economies plugged into electronics and semiconductor supply chains while leaving commodity- and agriculture-dependent economies more exposed. With the ADB flagging serious risks to farm output from a possibly very strong El Nino, the same year can bring record export earnings for some countries and food and energy stress for others.

UPSC angle

Prelims pointers

ADB's latest economic outlook, published Sept. 23, projects a widening growth gap among Asia's developing economies.
ADB headquarters: Manila, Philippines (the report dateline).
Economies flagged as hit harder by energy crisis and El Nino: Philippines and Cambodia.
Economies flagged as gaining from AI-driven export boost: India, Malaysia and Vietnam.
ADB warning: "likely very strong" El Nino effects this year could seriously hurt regional agricultural production.
El Nino is associated with drought stress in the region, as illustrated by a parched rice field in Pampanga, Philippines (2024).

Mains framing

The ADB's outlook points to growing divergence within developing Asia, driven by two simultaneous shocks and one tailwind: an energy crisis, a possibly very strong El Nino, and an AI-led surge in technology exports. Economies with deep positions in electronics and tech supply chains, such as India, Malaysia and Vietnam, can convert global AI demand into export growth, while economies more dependent on agriculture and imported energy, such as the Philippines and Cambodia, absorb the costs of drought and higher energy bills. The implication is that headline regional growth may mask sharply unequal outcomes, with climate variability acting as a macroeconomic, not merely a sectoral, risk to food output and prices. A grounded way forward, consistent with the ADB's warning, involves strengthening climate resilience in agriculture and irrigation, buffering households against energy and food price shocks, and broadening participation in technology-linked value chains so that the AI export boost is not confined to a few economies. Since the source does not state specific growth figures or policy prescriptions, any answer should stay with these directional trends.

Key terms

Asian Development Bank (ADB): Manila-headquartered multilateral development bank that publishes periodic economic outlooks for Asia's developing economies.
El Nino: A climate pattern that the ADB says could be "likely very strong" this year, posing serious risks to regional agricultural production.
AI-driven export boost: Rise in technology exports linked to artificial intelligence demand, benefiting India, Malaysia and Vietnam per the source.
Growth gap: The widening difference in growth rates between faster- and slower-growing developing Asian economies projected by the ADB.
Energy crisis: Energy market stress cited by the ADB as weighing more heavily on economies such as the Philippines and Cambodia.

Practice questions

Examine how climate shocks such as a strong El Nino can translate into macroeconomic divergence among developing Asian economies. Illustrate with the ADB's latest outlook.
"The AI-driven export boom risks deepening inequality within Asia rather than lifting the region uniformly." Critically discuss.
What policy measures can agriculture-dependent economies adopt to reduce vulnerability to simultaneous energy and climate shocks?

Grounded only in the source report — figures and dates are the source's, not inferred.

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