economic grwoth performance in asian pacific
...cession and the slump in the technology sector. In 2001, GDP contracted by 2.2%. The economy is expected to recover in 2002 in response to improvements in the US economy, and GDP growth for 2002 is projected to be 3% to 4%. In the longer term the government hopes to establish a new growth path that will be less vulnerable to the external business cycle than the current export-led model, but is unlikely to abandon efforts to establish Singapore as Southeast Asia's financial and high-tech hub (World Factbook, 2002). Malaysia, is a middle income country that transformed itself from 1971 through to the late 1990s from a producer of raw materials into an emerging multi-sector economy. Growth is almost exclusively driven by exports - particularly of electronics - and, as a result Malaysia was hard hit by the global economic downturn and the slump in the Information Technology (IT) sector in 2001. GDP in 2001 grew only 0.3% due to an estimated 11% contraction in exports, but a substantial fiscal stimulus package has mitigated the worst of the recession and the economy is expected to grow by 2% to 3% in 2002 as the world economy rebounds. Kuala Lumpur's healthy foreign exchange reserves and relatively small external debt make it unlikely that Malaysia will experience a crisis similar to the crisis of 1997, but the economy remains vulnerable to a downturn in the US and Japan, top export destinations and key sources of foreign investment (World Factbook, 2002). The GDP growth in Malaysia decelerated sharply in 2001 on the back of an export slowdown and weak domestic demand conditions. A surge in public spending in tandem with positive private consumption growth, over most of the year helped in avoiding a recession. It is likely that in the future there will be a modest acceleration of growth ( Asian Development Bank, 2002). Vietnam is a poor, densely populated country that has had to recover from the ravages of war, the loss of financial support from the old Soviet Bloc, and the rigidities of a centrally planned economy. Substantial progress was achieved from 1986 to 1996 in moving forward from an extremely low starting point - growth averaged around 9% per year from 1993 to 1997. The 1997 Asian financial crisis highlighted the problems in the Vietnamese economy but, rather than prompting reform, reaffirmed the government's belief that shifting to a market oriented economy leads to disaster. GDP growth of 8.5% in 1997 fell to 6% in 1998 and 5% in 1999. Growth then rose to 6.8% in 2000 and dropped back to 4.7% in 2001 against the background of global recession. These numbers mask some major difficulties in economic performance. Many domestic industries, including coal, cement, steel, and paper, have reported large stockpiles of inventory and tough competition from more efficient foreign producers. Meanwhile, Vietnamese authorities have moved slowly in implementing the structural reforms needed to revitalize the economy and produce more competitive, export-driven industries. The US-Vietnam Bilateral Trade Agreement entered into force near the end of 2001 and is expected to significantly increase Vietnam's exports to the US. The US is assisting Vietnam with implementing the legal and structural reforms called for in the agreement (World Factbook, 2002). Even though due to weakening exports the economy remained fast growing, with stable prices and solid indicators of public finance and external debt. There is a need for steadier progress in state enterprise and banking sector reform for the economy to maintain its international competitiveness, while policymakers should pay more attention to balanced regional development to consolidate past achievements in poverty reduction (Asian Development Bank, 2002). The GDP-real growth rate of India in 2002 was 4.3% whereas the GDP-per capita in 2002 was $2,540. The inflation rate stood at 5.4% and the unemployment rate of India in 2002 was 8.8% respectively. In 2001, India had exports of $44.5 billion dollars and its export commodities included textile goods, gems and jewelry, engineering goods, chemicals and leather manufactures. India had im...