With the increasing worries of slowdown in US economy, particularly
the demand; tech spending by individual and corporates, slower
business expansion, higher unemplyment rate, and credit crunch (banks
are not more reluctanct to extend credits), all point to the slowing
down of overall demand which has been the major engine force behind
the global investment booms, economies throughout the world are
scurrying for cover.
Japan. The consumers are still reluctant to spend and since the
economy is largely exposed to the developed market, the slowdown in US
will pose a tremendous challenge to the existing exporters.
China. The effect of the current policies to curtail the potential
overheating will be seen with the dwindling of export to the US
market. It means the import-export activities will be slowed in the
coming months. This will affect the Asian producers, especially the
poducts shipped are basically re-asembled to be exported to the
developed worlds.
India. Mainly the oursourcing partner to developed countries. The main
businesses are service center, insurance evaluation services, software
developers, will see surge of contracts from developed countries who
will diversify and invest more overseas amid the current financial
crisis in US.
Russia. The dynamics of the economy is still largely dependent on oil
and natural gas. The base is still small to fill the gap.
Malaysia. The industries affected the most are IT related, food,
textiles and garments. As the country inserted itself into the
production network, the spiralling effect of the slowdown of demand
from US economy exposes the strength of the local producers. It is
time to see have the local manufacturers positioned themselves
strongly in the network, or they depend on the artificial low exchange
rate to remain competitive in the world market. Inevitably, the local
demand is still small and cannot replace the vaccume left by the
slowdown, many manufacturers are becoming to feel the effect, and this
has forced to look to other alternatives or become more lean. It is
time for the local producers to augment their importance in the global
value chain.
john at http://economicsandpolitics.blogspot.com/
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