30/09/2008 - 11:24

Asia cushioned from global crisis: ASEAN

30/09/2008 - 11:24

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Lessons learnt from the Asian financial crisis are now cushioning the region from the continuing global fallout overnight from the United States equities quagmire, according to one of South East Asia's most prominent business commentators.

Lessons learnt from the Asian financial crisis are now cushioning the region from the continuing global fallout overnight from the United States equities quagmire, according to one of South East Asia's most prominent business commentators.

Addressing the first day of the 2008 Paydirt Asia Downunder Conference in Perth, ASEAN Federation of Mining Associations President, Benjamin Romualdez, said there was "no great love" in Asia, China or India for bailing out the United States and to a lesser extent, Europe, out of their current financial woes.

"The focus of the Asian region is very much internal," Mr Romualdez said.

"South East Asia not too long ago had its own Asian financial crisis and how we came out of that, provided many of the regulations that numerous Asian countries needed to put in place.

"That is in fact now saving some of these financial systems and economies from the negative impacts from the riskier debts that the US seemed all too willing to jump into.

"The result is world financial markets are seeing the Asia's fundament banking systems such as in Singapore, Hong Kong, China, the Philippines and Indonesia are very strong indeed.

"With the region able to participate in servicing the commodities' demand from China and India, South East Asia will be adequately insulated from the major US shocks where the issue of whether a recession in the US is inevitable, has been well and truly answered."

Mr Romualdez warned that it would remain difficult in coming days, weeks and even months to predict what could still happen.

"Against this malaise, there are some robust outcomes that should anchor our thoughts and beliefs and influence our re-assessment of how we proceed," Mr Romualdez said.

"China and India remain very strong and cashed up. China will have slower but sustainable growth of between 6.5% to 7-8% this year which is still robust growth.

"Both countries continue to have billions of people that will continue to need new development, infrastructure and resources.

"South East Asian mines will also benefit from the easing oil price as they will significantly bring down mining energy costs as well as significantly lower shipping costs.

"The region is also most favourably and strategically closer to the key large markets than other global competitors who will also face the issue of increasing unwillingness of banks to lend in a financial climate where there are even signs of a depression in the US.

"If such a depression looms, we can expect to see more Australian investment swinging into Asia's mining sector."

STANDING BY BUSINESS. TRUSTED BY BUSINESS.

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