Asian Tigers Economic Update

• After having stalled through much of last year, the process of trade integration between Australasia and East Asia looked to have regained momentum at the end of 2012 – especially exports to China. Exports from both Australia and New Zealand to the “Tiger” economies (ASEAN, S Korea and Taiwan) remain below their earlier levels.
•  This period of marking time reminds us that it is not all onwards and upwards in integrating Australasian economies into their wider region – factors like the global economic cycle and trade barriers play a role.
• This stagnation in our exports to the region through 2012 reflected the downturn in the global economy that hit exports from the trade-dependant economies of East Asia. This fed into slower industrial expansion which brought Tiger economic growth down to 3% yoy by the September quarter. Sluggish regional performance led to stalling imports which hit Australian and New Zealand shipment values.
• There are now a few straws in the wind that suggest that the worst has passed in the slowdown across the Tigers. Recent monthly indicators on trade and industrial output show modestly faster growth and a few of the surveys have turned up slightly – but it is still early days in the upturn.
• We expect a fairly modest upturn in growth, partly reflecting the absence of an outright recession last year in the region. Average growth across the Tigers of 3¾% and 4¼% is predicted for 2013 and 2014.For further analysis download the full report.

Asian Tigers Economic Update – February 2013 (PDF 483 KB)