Posts Tagged ‘Hong Kong’
The Asian Development Bank (Asian Development Bank / ADB) predicts economic growth in East Asian countries will decline this year and 2012.
This happens when the financial authorities in these countries continue to try to control inflation and economically advanced countries seek to bolster economic recovery is weak.
Based on the Asia Economic Monitor report from the Asian Development Bank (ADB), published Thursday in July (07/28/2011), expected growth in Gross Domestic Product (GDP) in developing countries in East Asia will grow by 7.9 percent in the aggregate in 2011 and 7.7 percent in 2012. Meanwhile, in 2010 the aggregate GDP growth reached 9.3 percent.
“Economic growth will decline in most East Asian countries emerging as authorities in these countries are slowly reducing efforts to tighten fiscal and monetary stimulus to face rising inflation,” said Head of ADB’s Office of Regional Economic Integration Iwan Jaya Azis.
Iwan added, it is actually good that the economy in these countries are more powerful as the People’s Republic of China is not too warm (overheat).
In this report analyzes the economic growth forecasts from the 10 ASEAN members, PRC, Hong Kong-China, Republic of Korea and Taipei, China. Economic growth in China declined slightly to 9.5 percent in the second quarter of 2011 after growing 9.7 percent in the first quarter.
Weak economies outside of China and monetary tightening is expected to reduce China’s growth to a sustainable level of 9.6 percent for the year 2011 and 9.2 percent in 2012. The economy in the new industrial area such as Hong Kong-China, Republic of Korea and Taipei, China is highly dependent on trade is also expected to re-grow at a more sustainable due to weaker external environment resulting drop in exports.
ADB cuts Asia growth
Asian Development Bank (The Asian Development Bank / ADB) states, developing countries in Asia should move more quickly to minimize the negative impact of slowing world economic growth.
In a recent report released yesterday, ADB lowers growth forecast East Asia next year due to the impact of the euro zone debt crisis that threatens the global economy.
Financial institution based in Manila, the Philippines, these cut the growth in gross domestic product (GDP) next year dropped to 7.2 percent from 7.5 percent previously to 10 ASEAN (the Association of South East Asian Nations) including China, Hong Kong , South Korea, and Taiwan.
ADB officials said the circumstances facing Europe and the United States (U.S.) has the potential to reduce economic growth by 1.2 percent to 4.2 percent for East Asia region including Japan. In fact, the forecast growth in the region previously predicted 5.4 percent.
According to the ADB, the projected decline in growth was mainly due to weak external demand, as well as European debt problems. Many people assessing the crisis in Europe could be a massive financial crisis and the effect on the global economy.
“The worst scenario is the U.S. and the euro zone fell back into a recession that pushed the global economy mired deeper and deeper,” the ADB report said East Asia. ADB states, with movement of the crisis was still in Europe, believed to prospects of economic growth for East Asia including Japan have declined from last September forecast.
According to the ADB, the global economic recovery could be hampered if the euro zone and the U.S. fell back into a recession that caused the global financial crisis to another. Based on ADB’s projections, the economy in the United States (U.S.) and Europe respectively only 2.1 percent and 0.5 percent next year. China’s economy predicted to grow by 8.8 percent in 2012.
Economic growth in the ASEAN region is also much slower than previous estimates. Indonesia’s economic growth is projected to grow only 6.5 percent in 2012. Indonesia’s economy has the potential to slow to 5.5 percent if Europe and the U.S. really in a recession. While Thailand and Japan each only able to grow by 4.5 percent and 2.5 percent next year.
ADB report also stressed yesterday that policy makers respond with decisive and collective efforts in stemming the crisis. In addition, the ADB also warned of downside risks such as protectionism and the instability of capital flows and inflation.
However, the problem of inflation likely ruled out because it was considered to have peaked in most economies without predicting a recession in the region.
Meanwhile, the euro zone if the problem turns into a massive crisis for the global economy, the impact on East Asia will become serious. However, the effect could be addressed if governments to act decisively.
“East Asia must be prepared for a prolonged crisis and slowing pascapemulihan crisis by implementing a long-term structural reforms,” ??the report said.
According to the ADB, one of the ways you can do is remain consistent in managing government spending to help maintain the growth momentum. As for central banks, each country must quickly manage its monetary policy tools to maintain inflation.
Meanwhile, the International Monetary Fund (International Monetary Fund / IMF) has predicted that Indonesia’s economy could only grow in the range of 6.3 percent next year. This prediction is below the government set a target of economic growth target of 6.5 percent.
IMF chief representative in Indonesia Milan Zavadjil say, the high level of consumption is still the backbone of Indonesian economy. Finance Minister Agus Martowardojo said the negative impact of the crisis makes the demand and consumption decline. According to him, the world economy is still haunted by the financial crisis in developed countries.
“High public debt they complicate public spending, the decline in consumption, and investment the state will affect consumption, as well as global investment,” said Finance Minister
The central bank lifted the benchmark base rate to 3.25 percent from 3 percent at a monthly monetary policy meeting.
The action dampened investment sentiment, because traders _ believing that rate hikes discourage growth and hurt stock prices _ often take fright. Hynix Semiconductor, one of the world’s largest memory chip makers, sank 4.7 percent. LG Electronics lost 2.6 percent.
Hong Kong’s Hang Seng was 0.8 percent down to 22,440.99 as banking shares dropped.
The Bank of China Ltd., one of the country’s four major state-owned commercial lenders, lost 0.5 percent. Agricultural Bank of China Ltd., the country’s biggest rural lender, lost 1.2 percent. Industrial and Commercial Bank of China, the world’s biggest bank by market value, was down 0.3 percent.
Australia’s ASX/S&P 200 rose 0.3 percent to 4,562.50. Benchmarks in Indonesia, the Philippines and New Zealand were also higher, while Singapore and Taiwan and mainland China fell.
On Wall Street, a report that U.S. exports hit a record in April sent stocks sharply higher Thursday as investors hoped the economic recovery may not be as sluggish as grim economic reports in the past week have suggested.
Stocks have been slipping since mid-April as investors become concerned that the U.S. economy has hit a soft patch. Rising oil prices, Japan’s tsunami and nuclear disaster and the risk that Greece might default on its debt have led investors to lower their forecasts for U.S. growth this year.
The Dow Jones industrial average rose 0.6 percent to close at 12,124.36. The Standard & Poor’s 500 index rose 0.7 percent to 1,289.00. The Nasdaq composite rose 0.4 percent to 2,684.87.
Thursday’s gains broke a six-day losing streak and marked the first time stocks rose in June. Stocks had dropped following poor reports on manufacturing, home sales, hiring and consumer confidence.
Benchmark crude for July delivery rose 11 cents to $103.04 per barrel in electronic trading on the New York Mercantile Exchange. The contract rose $1.19 to settle at $101.93 a barrel on Nymex on Thursday.
In currencies, the euro rose to $1.4537 from $1.4509 in late trading Thursday in New York. The dollar fell to 80.08 yen from 80.26 Japanese yen.