The IMF yesterday sharply slashed its growth outlook for Asia, predicting a “long and severe recession” for the region’s wealthier but export-reliant economies.
The US-based institution said it now expected growth in Asia would slow to 1.3 percent this year after a forecast late last year of 2.7 percent.
“The spillovers from the global crisis have impacted Asia with unexpected speed and force,” the IMF said in its regional economic outlook.
“Prospects for an imminent rebound of economic activity are weak,” it said, underlining that the region was heavily dependent on exports at a time when demand had weakened.
It said it expected 4.3 percent growth next year, down from a forecast of 4.5 percent.
For emerging countries in Asia, the IMF lowered its growth forecast to 3.3 percent from 4.4 percent. It put next year’s growth at 5.4 percent, down from an initial 6 percent.
The region’s wealthier economies “are expected to experience a long and severe recession” because of their heavy reliance on high-tech exports and extensive exposure to the global financial system, the IMF said.
Joshua Felman, an IMF assistant director, said Asia’s merchandise exports fell at an annualized rate of 70 percent between September last year and February this year, substantially worse than during the 1997 to 1998 Asian financial crisis.
“Why has the impact on Asia been so jarring? The answer lies in Asia’s exceptional integration into the global economy,” Felman said in Singapore. “Much of the region relies on technologically sophisticated manufacturing exports ... precisely those products which global demand has collapsed.”
Massive stimulus measures unveiled by several Asian governments were unlikely to help the region turn around strongly, and a rebound hinges on when the global upswing begins, he said.
“Whenever exports have slumped, Asia has typically slipped into recession — and Asia does not recover until exports have started to revive,” he said.
The IMF in the report urged Asia to “rebalance” its growth model and focus more on spurring domestic demand.
Japan was projected to shrink 6.2 percent this year. Growth in China was expected to be 6.5 percent this year, and in India was forecast to be 4.5 percent.
Hong Kong and Singapore were expected to shrink 4.5 percent and 10 percent respectively, the IMF said.
DISCONTENT: The CCP finds positive content about the lives of the Chinese living in Taiwan threatening, as such video could upset people in China, an expert said Chinese spouses of Taiwanese who make videos about their lives in Taiwan have been facing online threats from people in China, a source said yesterday. Some young Chinese spouses of Taiwanese make videos about their lives in Taiwan, often speaking favorably about their living conditions in the nation compared with those in China, the source said. However, the videos have caught the attention of Chinese officials, causing the spouses to come under attack by Beijing’s cyberarmy, they said. “People have been messing with the YouTube channels of these Chinese spouses and have been harassing their family members back in China,”
The Central Weather Administration (CWA) yesterday said there are four weather systems in the western Pacific, with one likely to strengthen into a tropical storm and pose a threat to Taiwan. The nascent tropical storm would be named Usagi and would be the fourth storm in the western Pacific at the moment, along with Typhoon Yinxing and tropical storms Toraji and Manyi, the CWA said. It would be the first time that four tropical cyclones exist simultaneously in November, it added. Records from the meteorology agency showed that three tropical cyclones existed concurrently in January in 1968, 1991 and 1992.
GEOPOLITICAL CONCERNS: Foreign companies such as Nissan, Volkswagen and Konica Minolta have pulled back their operations in China this year Foreign companies pulled more money from China last quarter, a sign that some investors are still pessimistic even as Beijing rolls out stimulus measures aimed at stabilizing growth. China’s direct investment liabilities in its balance of payments dropped US$8.1 billion in the third quarter, data released by the Chinese State Administration of Foreign Exchange showed on Friday. The gauge, which measures foreign direct investment (FDI) in China, was down almost US$13 billion for the first nine months of the year. Foreign investment into China has slumped in the past three years after hitting a record in 2021, a casualty of geopolitical tensions,
‘SOMETHING SPECIAL’: Donald Trump vowed to reward his supporters, while President William Lai said he was confident the Taiwan-US partnership would continue Donald Trump was elected the 47th president of the US early yesterday morning, an extraordinary comeback for a former president who was convicted of felony charges and survived two assassination attempts. With a win in Wisconsin, Trump cleared the 270 electoral votes needed to clinch the presidency. As of press time last night, The Associated Press had Trump on 277 electoral college votes to 224 for US Vice President Kamala Harris, the Democratic Party’s nominee, with Alaska, Arizona, Maine, Michigan and Nevada yet to finalize results. He had 71,289,216 votes nationwide, or 51 percent, while Harris had 66,360,324 (47.5 percent). “We’ve been through so
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