PRESS CONFERENCE LAUNCHING UN ECONOMIC AND SOCIAL SURVEY OF ASIA AND THE PACIFIC

While the United States economy was still the main driver of growth worldwide, countries in the Asia-Pacific region were now performing at such a level, that they too were becoming major locomotives of global growth, according to a United Nations-led survey launched today in cities throughout the region and elsewhere, including Bangkok, New Delhi, Tokyo, Geneva and New York.

The United Nations Economic and Social Survey of Asia and the Pacific for 2007, says developing economies in the region accounted for 16 per cent of global output and one-third of world economic growth in 2006..The Bangkok-based Economic and Social Commission for Asia and the Pacific (ESCAP), which compiles the annual review, adds that, as a whole, the 2007 outlook is above 7 per cent economic growth, and that the “Big Three” Asian economies –- China, India and Japan –- will maintain that momentum, and may provide good opportunities to other developing countries.

The 2007 Survey, Surging Ahead in Uncertain Times, sounds a cautionary note, warning that interventions by monetary authorities to keep currencies down are leading to inflated asset values, especially in housing and equity markets.  It sees six major downside risks to baseline forecasts for 2007: an oil price shock; an abrupt cooling of housing markets in the United States; a disorderly unwinding of global imbalances; a reversal of the Japanese economic recovery; economic “overheating” in China; and an avian flu pandemic.

Briefing reporters yesterday at United Nations Headquarters in New York, Robert Vos, Director of Development Policy and Analysis Division of the Department of Economic and Social Affairs, said that the external environment in the Asia-Pacific region was expected to be less favourable in 2007, mainly due to the slowing of the United States economy –- chiefly because of a weakening housing market -- and a decline in global electronics demand, but that dynamism by individual countries would continue to spur region-wide growth.

He said that China’s economy was expected to grow almost 10 per cent -- slightly lower than 10.7 per cent in 2006 -- largely driven by exports and investments.  That slight drop-off was mainly due to Government efforts to “cool down” the economy.  The Indian economy was expected to grow 9 per cent, spurred mainly by the service sector.  Investment was up region-wide.  Asian economies had also absorbed fluctuating oil prices, and the impact of higher heating and fuel costs was diminishing, as some countries moved towards greater energy efficiency, and, in a few cases, towards the use of bio-diesel.

While the overall economic outlook for the region was “robust”, he said that the Survey spotlighted several downside risks tied to global economic trends and possible events, those included failure to properly manage exchange rates; an oil price shock; further cooling of housing markets in the United States; a disorderly unwinding of global imbalances; a possible slow down of the Japanese economic recovery; and economic “overheating” in China.

Mr. Vos said that this year’s survey included a special study on the economic impact of gender discrimination, which revealed, among other things, that widespread gender inequality was costing the Asia-Pacific region billions of dollars every year.  He said ESCAP estimated the region was losing just short of $50 billion a year because of restrictions on women’s access to employment –- and another $16-30 billion a year because of gender gaps in education.

To put those deficits in perspective, he said that if female workforce participation was placed on a par with developed countries, such as the United States, India’s gross domestic product would be lifted by 1.08 percentage points –- a gain to the economy of $19 billion.  He added that if the countries of the region could boost education for women by one percentage point, gross domestic product could grow at a rate of almost 0.2 per cent faster than it was at the moment.

“These numbers are quite substantial, so there is a big case to be made to try and bridge these gaps in gender equality,” Mr. Vos said, telling reporters the Survey noted that some measures to ensure gender equality in the region were under way, as Governments launched action plans to attain the Millennium Development Goals.

But much more needed to be done and the Survey recommended, among other things, ending gender-based restrictions to certain professions, providing free primary education and ensuring that schools were closer to rural villages.  Responding to a question, he said that the Survey said that the Central Asian region scored relatively better than many others, particularly South Asian nations, in ensuring equality in education, and health and in providing economic opportunities.

He said the report also examined the challenges of “green” growth in the Asia-Pacific region, where many countries were struggling to balance rapid growth and urbanization with environmental protection and the use of clean energy technologies.  There was also evidence that the region, already suffering severe environmental degradation in some areas, was also on the way to becoming a major greenhouse gas emitter in the coming years, he added.

The Survey recommended a multi-track approach to ensure “greener” growth, he said, including “green taxation”, or higher taxes tagged to fossil fuel use, building more sustainable infrastructures; promoting sustainable, climate-friendly production and consumption patterns; providing incentives for “green” business practices; and improving the monitoring of environmental protection plans and initiatives. 

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