Business Times - 12 Aug 2009
(SINGAPORE) It is unlikely that China's domestic demand can replace the US' private consumption as a driver of global or regional economic growth any time soon, Singapore's Ministry of Trade and Industry (MTI) says.
'US private consumption could be the linchpin for sustainable global recovery, if it is not weighed down by job insecurity, falling personal income and tight credit conditions,' MTI's Second Permanent Secretary Ravi Menon said at yesterday's quarterly economic survey press briefing.
'There will be some spillover from China's own recovery, which has been going on handsomely and above expectations. But, much of that recovery has been domestically driven. And, the impact on the rest of Asia is more limited than you would see from an increase in US private consumption expenditure,' Mr Menon added.
Some economists have in recent months put forth the opposing view, which is that China's demand shall increasingly be an engine of growth for the region.
For instance, DBS economist David Carbon has on several occasions voiced his view that it is China's domestic demand which will be the key driver of Asia's recovery.
'China is the driving force behind the collapse in Asian exports, not the US, either directly or indirectly,' Mr Carbon wrote in a June 11 report. Consequently, it is China which will be the driving force behind Asia's rebound, the same report had said.
(SINGAPORE) It is unlikely that China's domestic demand can replace the US' private consumption as a driver of global or regional economic growth any time soon, Singapore's Ministry of Trade and Industry (MTI) says.
'US private consumption could be the linchpin for sustainable global recovery, if it is not weighed down by job insecurity, falling personal income and tight credit conditions,' MTI's Second Permanent Secretary Ravi Menon said at yesterday's quarterly economic survey press briefing.
'There will be some spillover from China's own recovery, which has been going on handsomely and above expectations. But, much of that recovery has been domestically driven. And, the impact on the rest of Asia is more limited than you would see from an increase in US private consumption expenditure,' Mr Menon added.
Some economists have in recent months put forth the opposing view, which is that China's demand shall increasingly be an engine of growth for the region.
For instance, DBS economist David Carbon has on several occasions voiced his view that it is China's domestic demand which will be the key driver of Asia's recovery.
'China is the driving force behind the collapse in Asian exports, not the US, either directly or indirectly,' Mr Carbon wrote in a June 11 report. Consequently, it is China which will be the driving force behind Asia's rebound, the same report had said.
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