PECC forecasts 4.4% growth in 18 countries<\/p>\n
JAKARTA (JP): The Pacific Economic Cooperation Council (PECC)
\nforecast yesterday that the economies of 18 Asia-Pacific
\ncountries are growing stronger this year, with estimated average
\ngrowth of 4.4 percent, as compared to 3.5 percent in 1993.<\/p>\n
The chairman of PECC's team for the Pacific economic outlook,
\nLawrence Krause, said during a seminar yesterday that the
\neconomies will likely grow by an average of 4.2 percent next
\nyear.<\/p>\n
He said the updated version of PECC's Pacific Economic Outlook
\n1994-1995 predicts that the average growth rate of the developing
\nnations in the region -- excluding the United States and Japan --
\nis even higher, with an estimated average growth of 6.4 percent
\nthis year and 6.2 percent next year.<\/p>\n
However, Krause warned of the imminent danger of rising
\ninflation as a result of the rapid economic growth in the region.<\/p>\n
"We should be watchful with the rising inflation, one of the
\neconomic factors which will potentially bring political
\ninstability," Lawrence said.<\/p>\n
The 18 economies included in PECC's forecast report are
\nAustralia, Canada, Chile, China, Colombia, Hong Kong, Indonesia,
\nJapan, Korea, Malaysia, Mexico, New Zealand, Peru, the
\nPhilippines, Singapore, Taiwan, Thailand and the United States.<\/p>\n
Krause said the estimated growth rate for 10 of the economies
\nwas marked up in the updated report, half of them by significant
\namounts of 0.5 percent or more, while the estimated growth rates
\nof two countries, Japan and Mexico, were reduced. The forecasts
\nfor Colombia, Peru and Taiwan were not updated.<\/p>\n
The Japanese forecast for this year, after being lowered from
\n1.1 percent to 0.7 percent, stands out as the lowest among the 18
\neconomies.<\/p>\n
China is forecast to have the highest growth rate of 10 this
\nyear, the only economy in the double digit range. However, the
\nvery high growth makes China bear a high inflation rate of 18.7
\npercent.<\/p>\n
Indonesia<\/p>\n
Indonesia is estimated to be in the high growth group. After
\nbeing revised upward by 0.4 percent, growth of 6.9 percent is
\nanticipated this year. Next year, its growth rate is estimated at
\n6.9 percent and in 1996 at 7.1 percent.<\/p>\n
Meanwhile inflation in Indonesia is accelerating as well and
\nis likely to reach 8.4 percent this year, well above the
\ngovernment's target of some five percent annually for the coming
\nfive years. However, the inflation is predicted to fall to 7.9
\npercent next year and 7.8 percent next year.<\/p>\n
Suhadi Mangkusuwondo, an Indonesian forecaster in the PECC,
\nsaid that the Indonesian forecast of high inflation is mainly
\ncaused by this year's draught, which has caused many consumer
\nprices to increase, together with the steep hike of cement
\nprices.<\/p>\n
He further noted that Indonesia's record of high growth is
\nstrongly related to its exports, which have continued to increase
\nin recent years. In addition to exports, domestic demand also
\nplays a major role.<\/p>\n
"The hikes in cement and vehicle prices indicate that domestic
\ndemand for those commodities is very strong. And this influences
\nthe economic growth rate," Suhadi said.<\/p>\n
He said that Indonesia's economy is closely related to
\neconomic trends in the Asia-Pacific region as 74 percent of its
\nexports go to countries in this region and 68 percent of its
\nimports come from the region as well.<\/p>\n
"The ups and downs of our economy follow the trends of the
\nworld economy, especially the one in the Asia-Pacific rim,"
\nSuhadi noted.<\/p>\n
He revealed that Indonesia's economic growth registered
\ndownturns in 1988 and 1989, after which the growth has been
\nincreasing. "The year 1993 was the upturn of the business cycle
\nin Indonesia and also in the Asia-Pacific region."<\/p>\n
Suhadi, who is also a professor in the Economics Faculty of
\nthe University of Indonesia, predicted that 1994 and 1995 will be
\nvital for the country's economy.<\/p>\n
However, he suspected that 1996 will mark the turning point of
\nthe country's growth. "Indonesia might bear downturns in its
\neconomy after 1996." (rid)<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/pecc-forecasts-44-growth-in-18-countries-1447893297",
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