With the exception of Japan, the rest of Asia came through the 2008 financial crisis with relatively little damage. But for the second time in less than four years, the region now faces another major external demand shock, which could turn a mild recession into something far worse.
While China’s economy is still booming compared with other world economies, the World Bank has once again cut China’s growth forecast to 8.2 percent. Calling on China to act quickly, the World Bank added that a slowing Chinese economy will be a burden to emerging East Asian economies, and warned that a deteriorating European debt crisis could inflict even greater damage on China.
Asia may be home to a number of emerging and developing markets, but it is also home to one of the poorest slums and regions in the world. In a regional report released today, the Asian Development Bank warns that Asia’s rising incomes could worsen the inequality gap, a situation that could undermine political stability and the region’s long-run growth prospects.
The ASEAN+3 forum – a group made up by countries in the Association of Southeast Asian Nations (ASEAN), together with China, Japan and South Korea – will double the amount of funds available under a regional currency swap pact, in order to safeguard their economies from future currency volatility.
A recent survey by HSBS has found that China has the highest number of “young-and-rich” in Asia. Furthermore, HSBC has found that investment in assets within the region is increasingly popular as a way to increase wealth.
According to the HSBC Holdings Plc report, which covered 8 asian economies including China, Hong Kong, Indonesia, Singapore, Malaysia, India, Taiwan and Australia, the average age of people in China with liquid assets worth at least 500,000 yuan (US$78,400) is 36, compared to 48 in Indonesia.
Hedge funds focusing on Asian investments experienced heavy losses in the second quarter,
but that did not seem to deter investors from giving them more money.
So what’s going on?
Asian-focused hedge funds lost $2.4 billion in the second quarter as stock indexes in the region fell sharply, Hedge Fund Research reports.
Yet it appears that changes in China’s monetary policy during the quarter attracted some investors
The World Bank has classified the economies of the world on the basis of income and region for the year 2006. This is a classification of all the member countries of the World Bank and other economies with populations more than 30,000. The groups made are as follows:
The World Bank has classified the economies of the world on the basis of income and region for the year 2006. This is a classification of all the member countries of the World Bank and other economies with populations more than 30,000. The groups made are as follows:
GDP growth projections among various Asian Economies over years are as follows:
GDP Growth Projection On Asian Economies
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Country Name |
2007 2008 |
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