Thursday 29 December 2011

ROACH ON INDIA AND CHINA

Today SG

WHY INDIA IS RISKIER THAN CHINA

But while the latter is in better shape, neither economy is likely to implode on its own

Stephen S Roach

Today, Dec 29, 2011

Asia's developing and newly industrialised economies grew at an 8.5 per cent average annual rate over 2010-11 - nearly triple the 3 per cent growth elsewhere in the world. If China and India are next to fall, Asia would be at risk, and it would be hard to avoid a global recession.

In one important sense, these concerns are understandable: Both economies depend heavily on the broader global climate.

China is sensitive to downside risks to external demand - more relevant than ever since crisis-torn Europe and the United States collectively accounted for 38 per cent of total exports in the past year. But India, with its large current-account deficit and external funding needs, is more exposed to tough conditions in global financial markets.

(…) [artículo aquí]

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