EXPORTS allowed the Asia-Pacific region to avoid the worst of the global financial crisis but growth is not expected to be sustained given the continued weakness of traditional developed markets, a United Nations agency said.
Developing economies in the region will likely see export growth halved to 9% this year from 17.3% in 2010, the UN Economic and Social Commission for Asia and the Pacific (ESCAP) said in its Asia-Pacific Trade and Investment Report 2011 that was released yesterday.
The Philippines, in particular, is expected to see exports expand by just 5.4% this year, from 33.7% in 2010, rising to 9.68% in 2012.
“It is challenging for Asian economies to maintain the growth momentum, given that the traditional developed economies of the Group of Three (G3: the European Union, Japan and the United States) will all face economic slowdown in the medium-to-long-term,” the UN agency said.
Domestic and regional demand, however, could take up some slack and the ESCAP noted recent developments as signalling increased resiliency. These include robust growth and urbanization, particularly in China and India, opportunities arising from increased global awareness of climate change, and the potential for increased regional trade and investment in services.
Needed reforms, it said, include adjustments in the production and export structure, expansion of trade and investment in “climate-smart” goods and technologies, ensuring an efficient supply of services, improving the region’s physical and institutional infrastructure, greater integration of small and medium enterprises into the regional and global value chains, and enhanced cooperation.
Asked to comment on the ESCAP outlook, University of the Philippines economist Benjamin E. Diokno said he agreed that an exports slowdown would occur.
“Exports will be slower because of weaker than expected recovery in the developed world,” said Mr. Diokno, a former Budget secretary. –Businessworld
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