Advertisement

New | Chart of the day: The hit to Asian growth from shifting trade flows

Reading Time:1 minute
Why you can trust SCMP
Chart of the day: The hit to Asian growth from shifting trade flows
East Asian economies, among others, have struggled to grow at rates as high as before the recession in 2008-09. The only country that has grown at a faster rate than just before the recession is the Philippines. As exports have been a principal driver of Asian economies, the overriding issue facing them is that global growth will likely remain slow for a number of years as spending patterns in developed economies will be slower than before 2007. But a shift in demand within Asia is likely to change that dynamic. "The horizontal trade pattern between the West and each Asian country in the past has been supplanted in good part by vertical supply chains and production between China and the rest of East Asia," says Paul Markowski of MES/Falconridge Advisers in a new note to clients. "In the future, it is likely that Asia's economic cycles will be as equally affected by changes in the Chinese economic cycle that, in turn, is affected by changes in the US, Europe and Japan as growth in the other large economies. Links between countries have just taken on a new patina."
Advertisement
Advertisement