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Asian economies face slight slowdown in '08: UN PDF Print E-mail
Friday, 11 January 2008

Agence France-Presse . Bangkok

Developing economies in the Asia-Pacific region will face a slight slowdown in 2008 as exports are likely to fall due to a wobbly United States economy, a UN report said Wednesday.

But overall the economies will remain robust thanks to surging growth in China and India, the world's fastest-growing economies, as India's economy is seen up nine per cent with China's 10.8 per cent in 2008, it said.

The economies, which exclude Australia, New Zealand and Japan, are set to grow by 7.8 per cent this year, down from 8.2 per cent in 2007, the United Nations Economic and Social Commission for Asia and the Pacific said.

'The region is expected to face a difficult external environment, with a slowdown in the US economy and continued appreciation of regional currencies,' the UN said.

A slowing US economy and anemic growth in Japan will pressure the region's export-driven economies, the report said, warning that textile and agricultural exports could be hit hard due to sluggish demand in the West and Japan.

But it added: 'Strong growth in China and India, sound economic fundamentals and buoyant commodity prices will underpin the region's resilience.'

Among risk factors, the United Nations called the US housing market crisis 'the major downside risk' in 2008, and warned that the scale of losses arising from the subprime loan problem could likely increase 'considerably' this year.

The United Nations also said Japan's growth would slow in 2008, saying that the world's second-largest economy 'has yet to fulfill the expectations of becoming an alternative growth engine for the region' to counter a wobbly US economy.

Japan's economy would likely expand only 1.7 per cent in 2008, down from 2.0 per cent in 2007, the UN report said.Inflation rates in the region were expected to remain high due to rising global oil prices and high food costs, it added

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