SINGAPORE, April 21, 2025 – The ASEAN+3 Macroeconomic Research Office (AMRO) today released its ASEAN+3 Fiscal Policy Report (AFPR) 2025, offering a comprehensive assessment of recent fiscal developments and the fiscal outlook for ASEAN+3 economies in 2025.
The report highlights that ASEAN+3 policymakers need to maintain flexibility to respond swiftly to emerging shocks amid heightened uncertainties, particularly given rising protectionist trends. At the same time, as fiscal positions weakened and fiscal space narrowed, sustained efforts to implement fiscal consolidation and rebuild buffers over the medium term are critical. Policymakers are also encouraged to adopt comprehensive policy packages to address structural challenges and foster sustainable, inclusive growth.
“Fiscal policies should remain agile and flexible to mitigate potential adverse impacts and support economic stability amid escalating trade uncertainties,” said AMRO Deputy Director Abdurohman (Functional Surveillance and Research). “Preemptively preparing contingency plans, and outlining specific scenarios and corresponding policy actions, will enable swift interventions with well-targeted measures.”
It is essential to clearly communicate the rationale, scope, and timelines for withdrawing contingency plans. Once economic risks diminish and stability is re-established, policymakers should promptly return to a medium-term fiscal consolidation path that upholds fiscal prudence.
Fiscal positions in many regional economies remain weaker than pre-pandemic levels due to incomplete revenue recovery, persistent expenditure pressures, or a combination of both. Despite signs of stabilization, elevated government debt and higher financing needs will substantially narrow fiscal space.
“Considering the importance of rebuilding fiscal buffers to mitigate future economic shocks and ensuring long-term fiscal sustainability, continued fiscal consolidation efforts over the medium term are warranted,” said Seung Hyun (Luke) Hong, AMRO Group Head for fiscal surveillance and lead author of the AFPR report.
To ensure effective fiscal consolidation, it is important to clearly calibrate fiscal targets, adopt a mix of revenue and expenditure measures, and expand the scope of public debt management.
The full AFPR 2025 report is available on the AMRO website.
About AMRO
The ASEAN+3 Macroeconomic Research Office (AMRO) is an international organization established to contribute toward securing macroeconomic and financial resilience and stability of the ASEAN+3 region, comprising 10 members of the Association of Southeast Asian Nations (ASEAN) and China; Hong Kong, China; Japan; and Korea. AMRO’s mandate is to conduct macroeconomic surveillance, support regional financial arrangements, and provide technical assistance to the members. In addition, AMRO also serves as a regional knowledge hub and provides support to ASEAN+3 financial cooperation.