Asia to take
\nhit amid
\nGlobal fallout<\/p>\n
Reuters
\nWashington<\/p>\n
Emerging economies in Asia, except for China and India, will
\nbe hit hard by the global slowdown and the potential economic
\nfallout of the Sept. 11 attacks on the United States, according
\nto the International Monetary Fund's World Economic Outlook
\nreleased on Wednesday.<\/p>\n
The Washington-based lender said the global slowdown,
\nespecially in the high-technology sector, coupled with higher oil
\nprices, political uncertainty in some countries and weakening
\nconfidence will hit newly industrialized economies such as Taiwan
\nand Singapore.<\/p>\n
While the overall economy of emerging Asia, which includes
\nIndia, China, Hong Kong and Korea, is forecast by the IMF to grow
\nat 5.1 percent this year and 5.9 percent in 2002, many Asian
\ncountries will suffer significant slowdowns.<\/p>\n
Singapore's economy, which grew by 9.9 percent last year, will
\ncontract 0.2 percent this year and should grow 4 percent in 2002.
\nTaiwan's economy will also shrink 1 percent this year after
\nhaving grown at 6 percent in 2000, said the fund.<\/p>\n
Indonesia, where market sentiment has improved after the
\npeaceful resolution to its political crisis, will see its economy
\ngrow 3 percent this year and 4.3 percent in 2002. But challenges
\nsuch as decentralization and containing inflation remained, the
\nfund said.<\/p>\n
While advanced economies on average should grow 1.3 percent
\nthis year, Japan, once one of the world's strongest economies,
\nshould see its output contract by 0.5 percent in 2001, the fourth
\nrecession in a decade, according to the fund.<\/p>\n
The country should see a slight recovery to growth of 0.2
\npercent next year, the IMF said.<\/p>\n
Growth in Asia was forecast to pick up in 2002, as is global
\neconomic activity, and the fund said it was encouraged that
\ndirect foreign investment in Asia held up.<\/p>\n
However, the IMF cautioned that these projections were made
\nbefore the attacks that rocked the United States on Sept. 11 and
\nwhich are likely to shake the global economy in the weeks and
\nmonths ahead.<\/p>\n
In the wake of the attacks, there exist major risks such as a
\nprolonged slowdown in America, a delayed recovery in the
\ntechnology sector and a bleak future for Japan, the fund said.<\/p>\n
Most Asian countries, however, were said by the IMF to be
\nbetter prepared than previously to weather such risks because
\neconomic fundamentals have improved since the 1997 Asian crisis,
\nsuch as large current account surpluses and flexible exchange
\nrates.<\/p>",
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"sponsor": "Okusi Associates",
"sponsor_url": "https:\/\/okusiassociates.com"
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