India, China, Singapore to lead Asia growth in 2010: Report


Regular Member
Aug 17, 2009
HONG KONG: Asia's economic recovery is on a firmer footing than three months ago with China set to easily reach its 8 percent growth target this
year and expand 9 percent in 2010, while trade-reliant Singapore and Taiwan will see a sharp turnaround next year, a Reuters poll shows.

"Providing we don't have a major relapse in the big advanced economies, I think this is the start of a durable economic recovery," said Rob Subbaraman, Asia economist at Nomura in Hong Kong.

"Domestic demand is an important part of it, but also exports are no longer collapsing as they were earlier in the year. At the very least they are stabilising."

The poll included gross domestic product (GDP) estimates from more than 100 analysts in 12 economies in Asia including Australia and New Zealand but excluding Japan.

Asia's faster-than-expected rebound from the global recession in recent months looks set to continue, in sharp contrast to a far murkier outlook for many Western economies.

China will remain Asia's best performing economy, helped by its massive $585 billion fiscal stimulus programme, and forecasts for 9 percent economic growth in 2010 were up from 8.8 percent in the previous Reuters poll in July.

Exports, though, will continue to lag their robust performance of recent years, squeezing China's trade surplus next year to $188.3 billion, from an estimated US$204 billion this year, the poll showed.
Stronger-than-expected recoveries likely point to interest rate rises in much of the region next year to curb potential inflationary pressures, though policymakers will be cautious about unwinding emergency stimulus measures until they are sure the global economy is on solid footing.

Australia's central bank raised rates last week and heralded more to come, saying the worst danger for the economy had passed.

Analysts expect South Korea to be the second G20 nation to raise rates as a property boom fuels worries about a potential asset bubble.

The poll showed the Bank of Korea is likely to keep rates on hold through the end of this year but the chance of an unexpected rise before then is higher than it was three months ago.

Asia's headstart in rebounding from the global recession, and the prospect of tighter monetary policy, will also keep upward pressure on Asian currencies.

Several central banks in the region have intervened in recent weeks to curb appreciation of their currencies, fearing it could make their exports less competitive and impede economic recovery.

Analysts expect the New Zealand dollar to rally 7 percent against the U.S. dollar between now and the end of next year, as New Zealand interest rates increase by an expected 150 basis points by the end of 2010. The Korean won is expected to appreciate 6 percent and Korean rates will rise by 100-125 basis points.

India, China, Singapore to lead Asia growth in 2010: Report - International Business - Business - The Times of India

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