"Risks are tilted to the downside, mainly because of uncertain pandemic dynamics, vaccine efficacy against virus variants, supply chain disruptions, and potential global financial spillovers from the US monetary normalization," the IMF said, adding that “The global Covid-19 pandemic is still ravaging the region.”

Nevertheless, Asia-Pacific will remain the fastest-growing region in the world, it added. China's economy is expected to grow by 8% in 2021 and 5.6% in 2022. "But the recovery remains unbalanced because private consumption continues to lag amid repeated outbreaks and significant fiscal policy tightening," the report said.

The organization expects India to expand 9.5% this year after a sharp decline in 2020. Growth prospects for Japan have been downgraded to 2.4% after a disappointing second quarter and state-of-emergency extensions.

According to the IMF, advanced economies like Australia, South Korea and New Zealand are benefitting from high-tech and commodity booms. Other emerging market and developing economies, notably ASEAN countries, still face severe challenges from a resurgent virus and from weakness in contact-intensive sectors.