US, China economic growth this year-economist
While global economies like the US one are slowing, countries in
Asia like China and India are showing fast growth, a top economist
said. Dr Arup Raha, chief economist of HSBC’s Asia-Pacific
region, told The Sunday Times FT that Asia was a good place to invest
as it is the fastest growing region in the world, is much stronger
than the pre crisis (1989) years and there are good companies here.
particular countries that would attract investments? “I think
generally it’s China and India where the structures and prospects
are good.” He said growth in India was strong and expected
to be around 7-8 percent this year with good monsoon rains as against
a positive growth rate of 7 percent last year. “The outlook
in India is very strong,” the HSBC economist said, adding
that some of that growth potential would spill over to countries
in the region like Sri Lanka.
Tuesday’s interview, Raha addressed a breakfast meeting in
Colombo for CEOs on the “Global economic outlook and Asia’s
In a wide-ranging presentation, the scenario he painted was one
of a global economy hit by slower growth in the US, a structurally
weak dollar and China easing on its rapid growth momentum.
said 2004 was the best year for growth in global economies, a growth
rate unlikely to be seen this year. Oil prices, he added, would
hover around the $60 per barrel level.
said world attention was shifting away from Japan where much-touted
reforms in the corporate and banking sectors didn’t work out
exactly the way they should have.
consumerism, he said consumers have stopped savings and are spending
all they have while the US Fed is the only Central Bank to raise
interest rates. “I don’t think there is a risk of inflation
even though prices may rise.”
On China where growth has been phenomenal and over nine percent
in the past few years, Raha said this kind of momentum is slowing
down. “A slower China has a lot of implications for Asian
exports to China.”