Asia, led by China, India and Indonesia, is emerging from the current global economic crisis sooner and stronger, a top IMF official has said.
"Asia looks set to emerge from the downturn both sooner and stronger than any other region," the First Deputy Managing Director of the International Monetary Fund, John Lipsky, said at a conference yesterday.
"Asia, despite its relatively strong initial condition entering the crisis, was hit hard late last year," he said.
While it was not directly exposed to the financial assets that were at the epicentre of this global crisis, Asia was severely affected by the sharp downturn in the US and Europe as the trade implications of the global downturn reverberated through the Asian supply chain, capital flowed out of the region, and trade finance stalled, he noted. Measured from peak to trough, real GDP has fallen by nearly four 4 per cent in the United States, but it fell by more than 8 per cent in Japan and by about 7 per cent in emerging Asia (excluding China, India, and Indonesia), he said.
The latest 'World Economic Outlook' of the IMF forecasts global economic contraction of about 1 per cent this year and expansion of around 3 per cent next year.
At the same time, Asia is expected to grow by over 2 per cent this year and by around 5 per cent in 2010, Lipsky said.