Asian growth will limit global economic slowdown
Tuesday, 26 Feb 2008 11:41
Asian growth will limit economic slowdown
Faster-than-expected growth in Asia will soften the impact of a US slowdown and the global credit crunch on world economic growth, according to a new report.
Economics consultancy Centre for Economics and Business Research (CEBR) has forecast global growth of 3.1 per cent in 2008, a fall from 4.0 per cent in 2007, as the credit crunch and stalling US economic growth take effect.
But the forecast is more optimistic than three months ago, as the likelihood of faster growth in Asia has increased.
Sarah Bloomfield, one of the report's authors, and economist at the CEBR, said: "Despite increased pessimism over the world economy over the last three months, the economic forecast is in line with a gradual and controlled global deceleration.
"Our forecasts for economic growth over the next two years have been revised up slightly."
According to the report, US output growth will fall sharply to 1.6 per cent in 2008 from 2.2 per cent in 2009 but will recover quickly with the economy expanding 3.5 per cent in 2010.
Growth in the EU25 member states is also set to slow to 1.8 per cent in 2008, although recovery will be slower than in the US and the area is set to expand 1.7 per cent in 2009 and 2.3 per cent in 2010.
Asian economic growth is to remain robust in 2008 at 7.1 per cent, supporting other global economies.
But Asia is likely to suffer a post-Olympic hangover with output expanding 5.7 per cent after the Games, the report said.