The August 2011 edition of the Asia Pacific Economic Outlookgives a near-term outlook for China, Japan, Malaysia, Taiwan and Vietnam.
CHINA:While China’s economy continues to hum, there are several questions being raised around the efficiency of large state-funded investment and also about the country’s economic model in general. It is likely that growth in 2011 will come in at a healthy pace, but slower than in 2010.
JAPAN:The worst seems to be over but the government’s policy response will likely determine the speed of Japan’s recovery. If electricity generation returns to normal, supply-chain issues are overcome and reconstruction spending is fast-tracked, Japan’s economy could stage a comeback in 2011.
MALAYSIA: Despite wavering international conditions, domestic demand in Malaysia has shown resilience. Favorable labor market conditions and accompanying income growth percolated down to robust consumer spending. While the outlook remains positive, inflationary pressures will likely intensify this year.
TAIWAN: Weak external demand put a damper on Taiwan’s otherwise bright outlook. Nevertheless, private consumption and investment will likely provide the necessary impetus for growth. The biggest risk is that consistently rising interest rates could encourage strong capital inflows thereby strengthening the local currency and hurting exports.
VIETNAM: The Vietnamese economy is growing, but so is inflation. As a result, the government’s focus has shifted from being predominantly pro-growth to ensuring macroeconomic stability and countering inflation. Amid tighter credit conditions, both consumer and investor confidence has waned. Yet, Vietnam is still on course to enjoy steady growth in 2011.
Asia Pacific Economic Outlook – August 2011 (5421.64 KB)
Published 11 August 2011; 14 pages; A Deloitte Research report.
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