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Asian business confidence bounces back

PARIS - Asian business confidence in a brighter economic outlook for the region bounced back strongly in July after deteriorating more than any other part of the world three months earlier, a global survey of business sentiment showed.

The quarterly economic climate indicator of the International Chamber of Commerce and the Munich-based Ifo Economic Research Institute rose to 96.3 points - slightly above the long-term average - after sinking to 79.6 in April.

Ifo reported: "The recent pick-up is mostly attributed to optimistic forecasts in all participating countries in the region for the coming six months." It said the positive impetus most likely derived from the fast containment of the SARS (severe acute respiratory syndrome) epidemic.

On the state of the Chinese economy, Ifo said participating experts were satisfied with the present overall economic performance. "Expectations for the next six months point to further improvement of the overall economy, in particular in capital investment, private consumption and exports."

The experts detected only weak signs of improvement in the depressed economic situation in Japan, Ifo said. Assessments for South Korea, Bangladesh, Taiwan and Indonesia were also downbeat.

While current economic performance also deteriorated in Hong Kong, private consumption, which was most strongly affected by the SARS epidemic, was expected to recover in coming months, in parallel with the overall economy.

The more than 1,100 respondents to the survey from 91 countries included corporate economists from multinational companies, academic economists and chamber of commerce executives.

The July survey included a special question on the impact of SARS on business. Worldwide, 46 percent of respondents estimated that the epidemic had an impact on economic growth, including 8 percent who said the impact was either severe or very severe.

Country breakdowns showed that business experts in Hong Kong (75 percent), followed by China (54 percent) and Canada (53 percent), saw economic growth in their countries as having been severely affected by the outbreak.

On a worldwide basis, 17 percent of respondents to the poll said they had significantly or very significantly cut down on business travels as a result of SARS. In Asia, 51 percent of all those polled in July said they reduced their business travel significantly.

(International Chamber of Commerce)
 
Aug 29, 2003


 
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