Robust growth hits Asia's trade surplus

Robust growth hits Asia's trade surplus

SINGAPORE (Reuters): Asia's overall trade surplus position is
deteriorating as stronger than expected growth numbers translate
into higher imports, according to a Reuters survey of 122
economists around the region.

Signs the 10-year run of economic expansion in the United
States might be coming to an end are making economists cautious
on the export front but the quid pro quo is a likely rise in
intra-regional trade as growth continues apace.

Taiwan's trade surplus is now expected to stand at $6.8
billion this year, well down on the $8.8 billion forecast in a
similar Reuters poll in March.

"Our trade surplus is likely to reduce sharply from last year
as post-quake reconstruction and building the high-speed train
would require the import of more machines and facilities," said
Albert Lin, research vice president of Hotung Securities.

Last year's September quake killed 2,400 people, wrecked
52,000 buildings and caused total losses of about $14 billion.
The high speed train will cost around $14 billion.

In Korea, strong growth will push up imports with the overall
trade surplus now seen at $9.3 billion this year compared with
$12.6 in the previous survey.

"Rising oil prices and an increase in facilities investment
are the two main factors for our revised forecast," said Oh Suk-
tae, chief analyst at Citibank. "More facilities investment means
more imports."

Indonesia's trade surplus is seen at $26.7 billion this year
which compares with the $22.2 billion in the previous survey.

"Why a higher surplus this year? Although import growth is
expected to outpace export growth, the import base is very, very
small," said economist Song Seng Wun from GK Goh Securities in
Singapore. "Meanwhile oil, gas, textiles and chemicals are
underpinning exports."

Thailand's surplus is also seen rising with any slack in
exports to the U.S. offset by increased trade with Southeast
Asian countries.

Imports to China are likely to rise due to growing domestic
demand and the impact of China's entry into the World Trade
Organization.

Exports to the U.S. accounted for 22 percent of China's total
last year so an economic slowdown there would hurt.

"China's economy has rebounded in the first quarter of this
year. Rising domestic demand will accelerate imports, and imports
will speed up after China's entry into WTO," said Citibank
analyst Joe Lo.

Nevertheless, analysts held their forecasts for China's trade
surplus steady at $27.4 billion for this year, barely changed
from a forecast of $27.0 billion in the previous survey.