The menaces of terror, deflation and a war-related rise in oil prices cloud an otherwise bright outlook for East Asian economies, the World Bank said on Wednesday.
East Asia and Pacific economies are expected to grow 6.4 percent this year, slightly down from 6.7 percent last year, said the Bank's Global Development Finance 2003 report.
"The forecast anticipates average regional growth of more than 6 percent over the next two years with China increasingly the dominant player," it said.
Exports would be key, helped by China's integration into the World Trade Organization.
Exceptions to the rosy outlook were Hong Kong and Singapore, where growth had faltered, and Indonesia, still reeling from the Oct.12 bombing of a Bali nightclub last year in which 202 people were killed.
Four key tensions overshadowed a horizon of rapid growth, low inflation and strong external accounts:
-- Oil. Every US$10-a-barrel rise in the price of oil during the Iraq war costs the region's net energy imports about 0.6 percent of gross domestic product.
-- Instability. "The unpredictability of developments on the Korean Peninsula has become a new regional concern and the memory of the bombing tragedy in Bali is a recent reminder of the problem of terrorism in the region," the report said.
-- Exchange rates. With fierce competition for western markets, "the question of appropriate exchange rates is likely to emerge as a larger issue," it said.
-- Deflation. "The corrosive effects of deflation, already painfully evident in Japan, could become more pervasive across the region if measures to promote corporate restructuring are slow."
South Asian economies, meanwhile, were tipped to grow 5.3 percent this year, up from 4.9 percent last year.
Poor weather, political insecurity and a subdued global economy had put a damper on the region's growth last year, although India-Pakistan tensions eased and a ceasefire was reached in Sri Lanka's civil war.
"Improving exports and a recovery in agriculture, which accounts for a quarter of the region's output, are together expected to boost GDP growth to 5.3 percent over the next years," the Bank said.
But higher export revenue would likely be channeled into higher imports, leading to little overall change in the trade balance, it said.
Domestic demand should gather momentum, it forecast, particularly in India as agricultural incomes recover.
"The outlook for India dominates South Asia's economic prospects," the report said.
"Manufacturing performance in India is showing signs of an incipient upturn, and the burgeoning Bangalore-based international services sector has experienced much less disruption in demand than high-tech sectors elsewhere."
Among the rows of vibrators, rubber torsos and leather harnesses at a Chinese sex toys exhibition in Shanghai this weekend, the beginnings of an artificial intelligence (AI)-driven shift in the industry quietly pulsed. China manufactures about 70 percent of the world’s sex toys, most of it the “hardware” on display at the fair — whether that be technicolor tentacled dildos or hyper-realistic personalized silicone dolls. Yet smart toys have been rising in popularity for some time. Many major European and US brands already offer tech-enhanced products that can enable long-distance love, monitor well-being and even bring people one step closer to
Malaysia’s leader yesterday announced plans to build a massive semiconductor design park, aiming to boost the Southeast Asian nation’s role in the global chip industry. A prominent player in the semiconductor industry for decades, Malaysia accounts for an estimated 13 percent of global back-end manufacturing, according to German tech giant Bosch. Now it wants to go beyond production and emerge as a chip design powerhouse too, Malaysian Prime Minister Anwar Ibrahim said. “I am pleased to announce the largest IC (integrated circuit) Design Park in Southeast Asia, that will house world-class anchor tenants and collaborate with global companies such as Arm [Holdings PLC],”
TRANSFORMATION: Taiwan is now home to the largest Google hardware research and development center outside of the US, thanks to the nation’s economic policies President Tsai Ing-wen (蔡英文) yesterday attended an event marking the opening of Google’s second hardware research and development (R&D) office in Taiwan, which was held at New Taipei City’s Banciao District (板橋). This signals Taiwan’s transformation into the world’s largest Google hardware research and development center outside of the US, validating the nation’s economic policy in the past eight years, she said. The “five plus two” innovative industries policy, “six core strategic industries” initiative and infrastructure projects have grown the national industry and established resilient supply chains that withstood the COVID-19 pandemic, Tsai said. Taiwan has improved investment conditions of the domestic economy
Sales in the retail, and food and beverage sectors last month continued to rise, increasing 0.7 percent and 13.6 percent respectively from a year earlier, setting record highs for the month of March, the Ministry of Economic Affairs said yesterday. Sales in the wholesale sector also grew last month by 4.6 annually, mainly due to the business opportunities for emerging applications related to artificial intelligence (AI) and high-performance computing technologies, the ministry said in a report. The ministry forecast that retail, and food and beverage sales this month would retain their growth momentum as the former would benefit from Tomb Sweeping Day