Channel News Asia (11 January 2008)
By IndoChina Correspondent Anasuya Sanyal Posted: 10 January 2008 2046 hrs
BANGKOK: A new United Nations report forecasts that global economic slowdown is likely to weigh on Asian economies in 2008. Although they will continue to expand – despite record oil prices and fears of a possible recession in the United States – UN economists said growth may not match the rates achieved in 2007. Last year, developing Asia Pacific economies achieved 8.2 percent average growth. The forecast for this year is 7.8 percent, spurred on by powerhouses China and India. The experts said while the regional economy is not as tied to developments in the US as a decade ago, countries heavily reliant on exports will be hardest hit. Many Asian currencies have been appreciating against the greenback, weakening exports. The potential Asian repercussions of a deepening sub-prime home loan crisis in the US and a hard landing for the US dollar would hit the economies of Taiwan, Korea and Singapore the most as they are the most open. China's growth rate could go down 3 percent, but India would be the least affected country in the region. The Chinese economy registered 11.5 percent growth for 2007, while India grew by 9 percent. The UN economists said sound macro-economic policies and diversified export destinations will limit the impact of external shocks on the region. For Thailand, Southeast Asia's weakest performer last year, UN economists attributed its slowdown to political instability and a decline in demand. But they believe the kingdom can attain 4.9 percent growth this year, up from 4.5 percent. Ravi Ratnayake, Chief Economist, United Nations Economic & Social Commission for Asia & The Pacific, said: "Firstly, it is important to have a clear direction of policy so that investors and consumers know where the economy is heading. That's number one. Number two and most importantly, is political stability." Thailand held general elections last month and a new government has to be formed in the coming weeks.
By IndoChina Correspondent Anasuya Sanyal Posted: 10 January 2008 2046 hrs
BANGKOK: A new United Nations report forecasts that global economic slowdown is likely to weigh on Asian economies in 2008. Although they will continue to expand – despite record oil prices and fears of a possible recession in the United States – UN economists said growth may not match the rates achieved in 2007. Last year, developing Asia Pacific economies achieved 8.2 percent average growth. The forecast for this year is 7.8 percent, spurred on by powerhouses China and India. The experts said while the regional economy is not as tied to developments in the US as a decade ago, countries heavily reliant on exports will be hardest hit. Many Asian currencies have been appreciating against the greenback, weakening exports. The potential Asian repercussions of a deepening sub-prime home loan crisis in the US and a hard landing for the US dollar would hit the economies of Taiwan, Korea and Singapore the most as they are the most open. China's growth rate could go down 3 percent, but India would be the least affected country in the region. The Chinese economy registered 11.5 percent growth for 2007, while India grew by 9 percent. The UN economists said sound macro-economic policies and diversified export destinations will limit the impact of external shocks on the region. For Thailand, Southeast Asia's weakest performer last year, UN economists attributed its slowdown to political instability and a decline in demand. But they believe the kingdom can attain 4.9 percent growth this year, up from 4.5 percent. Ravi Ratnayake, Chief Economist, United Nations Economic & Social Commission for Asia & The Pacific, said: "Firstly, it is important to have a clear direction of policy so that investors and consumers know where the economy is heading. That's number one. Number two and most importantly, is political stability." Thailand held general elections last month and a new government has to be formed in the coming weeks.
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