TOKYO, JAPAN - FISCAL stimulus could be an option for emerging Asian economies if global growth slows further but the main concern for now is to contain inflation, the head of the Asian Development Bank (ADB) said on Friday.

Haruhiko Kuroda, visiting Tokyo for the Group of Seven finance leaders' meeting, said emerging Asian economies are expected to grow strongly, albeit at a somewhat slower pace this year than in 2007 as the US slowdown hits exports from Asia.

If necessary, emerging Asian nations with increased fiscal space could take stimulus measures for their economies, although such a step is not a priority for now, Kuroda told a symposium hosted by the ADB, a Manila-based multilateral lender.

'For them, the important challenge still is to contain inflationary pressures rather than (implementing) fiscal stimulus,' said Mr Kuroda, a former senior financial diplomat at Japan's Ministry of Finance.

His remarks followed those by International Monetary Fund Managing Director Dominique Strauss-Kahn, who said last month that monetary policies were insufficient on their own to address global economic problems and that fiscal policy had to be employed as well.

Mr Kuroda said that while Asia's strong economic fundamentals have helped mitigate the US impact, the region is not totally immune to global market turbulence.

'Often in the past, when the US sneezed Asia caught a cold, and when the US got a cold, Asia got pneumonia,' Mr Kuroda said.

'Though such a strong impact of the US economy on Asia is long gone, a deep and prolonged US recession, should it ever occur, could be accompanied by much slower growth in Asia.'

Asian economies have also become more exposed to swings in stock prices as global financial links strengthen, he said.

Mr Kuroda, who was Japan's top financial diplomat from 1999 to 2003, has been cited by analysts as a potential candidate to replace Bank of Japan Governor Toshihiko Fukui when he retires at the end of his term next month. -- REUTERS