Asia's future and the financial crisis

This is from McKinsey Quarterly, that Asia going forward would have to look beyond a likely permanent-ish collapse of demand among the G3 (Euro zone, Japan, USA) and create their internal markets. This stream of thinking echoes a fair bit on the Economic Roundtable talks last week organized by the Singapore Business Times and the Institute of Policy Studies, where they highlighted three things in particular for SGP to do in the future: (a) tap on the ascendancy of Asia beyond the G3 (b) deal with erosion of cost competitiveness esp from China in electronics sector and (c) maintain social cohesion as the Gini coefficient is rising.

Lastly, during the Roundtable, several ideas that have always been floating around seem to be louder … have more entrepreneurs, shift to high value added services based economy, deepen a shallow domestic market.

The region has been hit hard but can help the world recover. Meanwhile, the global crisis is likely to spur further integration among Asian markets.

DECEMBER 2008 • Dominic Barton

The collapse of Lehman Brothers triggered a global credit shock that struck with surprising force in Asia. Before Lehman’s failure, many looked to the region as a bastion of economic stability. After all, Asia had high growth rates, large trade surpluses, and substantial foreign reserves….

London after dark: Singapore’s export dependence on US, Europe and Japan is a source of vulnerability, economists say

S’pore should tap deeper into Asia

Economists explore nation’s options in face of downturn and changing world

By TEH SHI NING

(SINGAPORE) Singapore may need to re-examine its export strategies and seek to tap more into Asian growth, economists at a Singapore Economic Roundtable said last week. Singapore’s high export dependence on the Group of Three (G-3) – the US, Europe and Japan (including, indirectly, via exports to China) – is a source of vulnerability in the ‘demand drought’ brought on by the global downturn, they said.

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