The World Bank recently launched an East Asia energy flagship report in Singapore: “Winds of Change: East Asia’s Sustainable Energy Future” (full disclosure: I&r
In the years since the 1997/1998 Asian financial crisis, the Bank of Thailand (BoT) worked hard to build a heavy fortress around the nation’s financial sector. As a result, at a time when credit markets froze in developed countries and investors “fled to quality,” large amounts of capital still flowed into Thailand, where banks remained solid and well capitalized. Despite the financial strength brought by prudent policies, for the first time since the financial crisis, Thailand will see GDP and household consumption drop, and poverty could even increase in 2009. It is clear that the financial armor was insufficient to protect the economy from another crisis.
The culprit has been identified as Thailand’s excessive reliance on external demand, and talk of “rebalancing” growth towards domestic consumption and investment has become quite common (pdf). The idea of rebalancing makes some sense – but it can also be misleading. Let me explain.
If you haven’t already taken the time to do some development-related Googling after last week’s announcement that World Bank statistics are now available through the ubiquitous search engine’s public data tool, I’d suggest exploring the exciting new feature. Now, anyone can easily access 17 World Development Indicators by searching for them in Google. Give it a try by searching for the GDP of China or CO2 emissions of Indonesia or exports of Thailand – or another country and any of these indicators.
When you click on the search result, an interactive chart page shows you how the data have changed over time and allows you to compare to other countries (or the world). (You can also embed the chart, like the one below.) For example, take a look at how the GDP growth rate of China compares to Indonesia, Thailand and the Philippines in the last 50 years.
To further explore the data, check out another nifty tool, also launched last week by the World Bank. DataFinder lets you research more about these development indicators and see how they look on an interactive map. Read more about DataFinder here.
|There is a great deal of passion surrounding the subject of tiger conservation, and there was a great deal of energy at the recent Global Tiger Workshop in Kathmandu, Nepal. (Photo courtesy of catlovers under a Creative Commons license.)|
I’m writing this in Kathmandu, Nepal, at the end of the Global Tiger Workshop, the latest event leading up to the Tiger Summit expected to be held late next year in Vladivostok. This process all began with the major launch of the Global Tiger Initiative (GTI) in Washington, DC, in June 2008, and direct engagement with the tiger range countries on the issue of illegal wildlife trade really took off in Pattaya, Thailand, in April this year with ASEAN-WEN and other partners.
This was no ordinary World Bank-facilitated meeting inasmuch as National Geographic filmed the event, and it included a kilometer-long, elephant-led parade of children calling for the conservation of tigers. The GTI team keyed into the Asian and global media through op-eds, press releases, and YouTube. It also had significant support from the highest levels of the Nepali government which excelled itself not just in organizational support and hospitality, but also in commitments for tiger conservation – i.e. plans to double the size of one of its top tiger habitats, Bardia National Park. As remarked by Eric Dinerstein, World Wildlife Fund-US Chief Scientist, there has not been such a positive period for the future of Nepal’s tigers in all the 35 years he has been living in and visiting Nepal.
As part of its regular monitoring of the corporate sector in Southeast Asia, the World Bank economic team I am part of in Thailand has been working on a short case study of supply chains of Japanese multinational companies (MNCs) in the electrical and electronics (E&E) industry. We wanted to hear directly from firms about how the crisis affected them, how they were able to adjust so quickly to the drop in demand, what the rebound looked like, and what were the prospects going forward to upgrade along the value chain. I have learned a great deal from these interviews, and have become convinced that supply chains are central to understanding the current crisis in Thailand and East Asia more generally.
Some facts: the crisis had a disproportionate impact on manufacturing. In Thailand, manufacturing represents about 40 percent of GDP, but contractions in manufacturing value added have accounted for about 75 percent of the contraction of headline GDP. Within manufacturing, the auto and E&E industries account for the bulk of the contraction. Most of the output in those industries is exported, and more than three-fourths of the decline in Thai exports during the crisis was due to falls in shipments from the auto and E&E industries. My conclusion is that the magnitude of the crisis in Thailand has been driven primarily by these two industries.
Regionally speaking, developing countries in East Asia and Pacific have rebounded surprisingly quickly from the financial crisis and global recession. But according to a report just released by the World Bank, the regional economic picture isn’t as rosy when China is taken out of the equation. The latest East Asia and Pacific Update report, an assessment of the economic health of the region released every six months, is titled “Transforming the Rebound into Recovery.” The rebound, the report says, was driven in part by large and timely fiscal stimulus spending led by China and Korea. Still, despite the well-performing economies of Indonesia and Vietnam, developing East Asia excluding China is projected to grow at just around 1 percent in 2009. And for Cambodia, Malaysia and Thailand, GDP is contracting.
The China Quarterly Update – a separate report released at the same time as the latest regional assessment and focusing specifically on the Chinese economy – gives a more complete picture of why the country has seen such robust economic growth and what the future may hold. The Bank now projects China to see GDP growth of 8.4 percent for 2009, says the report. The report’s lead author (and blogger) Louis Kuijs wrote an accompanying blog post, which can be read here.
I really recommend taking some time to explore the findings of both reports by visiting the East Asia Update and China Quarterly pages, where you can also download high resolution graphs and watch video interviews with the economists. Also, you'll be able to ask two World Bank economists questions about the regional report in an online chat taking place Thursday, November 12, at 10 a.m. DC time (15:00 GMT or 11:00 p.m. in Beijing). Send your questions now for a better chance of getting them answered.
Here’s an interesting and quick item to check out on a Friday. This map gives an attractive, at-a-glace look at some of the world’s key natural resources, organized by country. A couple of things to note that are East Asia-related: China leads more categories (at least on this map) than any other country, including wheat, cotton, gold and rice.
Given that Asia is now widely seen as leading the world out of the crisis, it is fitting that the role of Asia was more prominently recognized in the global economic system in the recent G20 meeting held in Pittsburgh. Since we last looked in July, the outlook for the emerging markets of East Asia has continued to brighten. The latest regional forecasts come from the Asian Development Bank in its Asian Development Outlook (pdf) published last week. It points to “the rapid turnaround in [Asia’s] largest, less export-dependent economies” and predicts that “the regional economy is now poised to achieve a V-shaped rebound.” These are very positive words indeed! As the graph below shows, the ADB has in fact upgraded its growth forecasts for a number of economies for 2009.
Although the signs are pointing upwards, performance is still mixed in a number of key areas.