Asian economies could see a modest recovery next year, boosted by stronger export demand and stimulus spending, the IMF said on Wednesday.
Trade-driven Asia has been hit harder than expected by the worst global downturn since the 1930s, though many economies are stronger than they were during the region’s 1997 financial crisis, the Washington-based IMF said in a report.
“A modest recovery is projected in 2010, underpinned by a pickup in global growth and a boost from expansionary fiscal and monetary policies,” the IMF said in its semiannual World Economic Outlook report.
Japan, the region’s economic giant, should eke out 0.5 percent growth next year after shrinking by 6.2 percent this year, the IMF said. It said South Korea, Taiwan and other newly industrialized economies were forecast to grow by 0.8 percent following a 5.6 percent contraction this year.
Growth for China, India and other emerging economies is forecast to rise to 5.3 percent after falling to 3.3 percent this year, the IMF said.
But the IMF also cautioned that Asian economies face risks if global demand weakens further and said they can do more to reduce reliance on exports by boosting domestic consumption.
“A key concern is that a deeper or longer recession in advanced economies outside Asia will reduce external demand even further, with negative repercussions for exports, investment and growth,” it said.
The main challenge will be to “achieve a sustained reduction in the region’s reliance on exports as a source of growth,” the IMF said.
Though China, Japan and others have launched stimulus plans, it said: “There is scope to do more to bolster domestic demand in a number of economies” that can afford it.
China’s growth is forecast to rise to 7.5 percent next year after falling to 6.5 percent this year — half of 2007’s 13 percent rate.
India’s growth is expected to climb to 5.6 percent next year after dropping from 7.3 percent last year to 4.5 percent this year.
In Asia’s worst contraction, Singapore’s economy is expected to shrink by 10 percent this year and by another 0.1 percent next year, the IMF said.
The IMF projected the global economy would shrink 1.3 percent this year, saying the financial crisis was proving more entrenched than expected.
The world economy was sliding into “the deepest post-World War II recession by far,” and the outlook was “exceptionally uncertain,” with risks weighing on the downside, the 185-country institution said.
It was the third time the IMF has slashed its 2009 world growth estimate this year. In January, the multilateral institution saw growth of 0.5 percent, but by March it had forecast a contraction of between 0.5 percent and 1 percent.
The US economy would contract 2.8 percent this year, while the eurozone would shrink 4.2 percent. The IMF forecast contractions of 4.1 percent in Britain and 6 percent in Russia.
The IMF predicted a slow recovery next year, with the rate of contraction expected to be “moderate” from the second quarter onward.
The growth next year would come entirely from the emerging market and developing countries, at 4 percent.
NO HUMAN ERROR: After the incident, the Coast Guard Administration said it would obtain uncrewed aerial vehicles and vessels to boost its detection capacity Authorities would improve border control to prevent unlawful entry into Taiwan’s waters and safeguard national security, the Mainland Affairs Council (MAC) said yesterday after a Chinese man reached the nation’s coast on an inflatable boat, saying he “defected to freedom.” The man was found on a rubber boat when he was about to set foot on Taiwan at the estuary of Houkeng River (後坑溪) near Taiping Borough (太平) in New Taipei City’s Linkou District (林口), authorities said. The Coast Guard Administration’s (CGA) northern branch said it received a report at 6:30am yesterday morning from the New Taipei City Fire Department about a
IN BEIJING’S FAVOR: A China Coast Guard spokesperson said that the Chinese maritime police would continue to carry out law enforcement activities in waters it claims The Philippines withdrew its coast guard vessel from a South China Sea shoal that has recently been at the center of tensions with Beijing. BRP Teresa Magbanua “was compelled to return to port” from Sabina Shoal (Xianbin Shoal, 仙濱暗沙) due to bad weather, depleted supplies and the need to evacuate personnel requiring medical care, the Philippine Coast Guard (PCG) spokesman Jay Tarriela said yesterday in a post on X. The Philippine vessel “will be in tiptop shape to resume her mission” after it has been resupplied and repaired, Philippine Executive Secretary Lucas Bersamin, who heads the nation’s maritime council, said
REGIONAL STABILITY: Taipei thanked the Biden administration for authorizing its 16th sale of military goods and services to uphold Taiwan’s defense and safety The US Department of State has approved the sale of US$228 million of military goods and services to Taiwan, the US Department of Defense said on Monday. The state department “made a determination approving a possible Foreign Military Sale” to the Taipei Economic and Cultural Representative Office in the US for “return, repair and reshipment of spare parts and related equipment,” the defense department’s Defense Security Cooperation Agency said in a news release. Taiwan had requested the purchase of items and services which include the “return, repair and reshipment of classified and unclassified spare parts for aircraft and related equipment; US Government
More than 500 people on Saturday marched in New York in support of Taiwan’s entry to the UN, significantly more people than previous years. The march, coinciding with the ongoing 79th session of the UN General Assembly, comes close on the heels of growing international discourse regarding the meaning of UN Resolution 2758. Resolution 2758, adopted by the UN General Assembly in 1971, recognizes the People’s Republic of China (PRC) as the “only lawful representative of China.” It resulted in the Republic of China (ROC) losing its seat at the UN to the PRC. Taiwan has since been excluded from