Economic and social survey of Asia and the Pacific 2011

• The Economic and Social Commission for Asia and the Pacific (ESCAP)

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09 May 2011The Asia-Pacific developing economies have recovered well in 2010 from the global financial crisis of 2008/09. The dramatic V-shaped recovery witnessed in 2010 by the economies in the region was supported by massive fiscal stimulus packages along with renewed strength in exports. It helped the Asia-Pacific region emerge as a growth pole and a critical anchor for global recovery. As the recovery consolidates in 2011, the economies face fresh challenges, notably the rising inflationary pressures especially with the return of food and fuel crises. Furthermore, many export-driven Asia-Pacific economies could suffer the knock-on effects of sluggish growth in some advanced economies, including the United States of America and the European Union, in which some governments have undertaken drastic programmes to reduce deficits through spending cuts and tax increases. Moreover, there is a risk that some Asia-Pacific economies could be destabilized by volatile flows of speculative capital.

The 2011 earthquakes and tsunami in Japan will also have wide repercussions, though smaller than might have been expected initially. ESCAP estimates that a one percentage point slowdown of economic growth in Japan relative to 2011 baseline growth would result in a 0.1 percentage point slowdown in growth for the Asia-Pacific developing economies as a whole.

In the medium term, governments will also need to consider ways to boost domestic demand and intensify regional integration. In this light, the Economic and Social Survey of Asia and the Pacific 2011 considers how to improve regional connectivity, and also indicates how the least developed countries can take advantage of this by increasing their productive capacities.