Global economy not yet out of the woods

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Not all is however gloomy. "Even if there is a real double dip, the impact will be weaker than the global financial crisis of 2008," said Chen Xingdong, chief economist of BNP Paribas Securities (Asia) Ltd.

The US economy grew 3.2 percent in the first three months of this year, the third consecutive quarter of positive growth, according to the US Commerce Department.

"But the growth is still below 2008 levels. The US economy lacks new engines for economic expansion in the short term," Chen said.

Xia Yeliang, an economist at Peking University, said that the absence of new industrial engines puts a question mark on the long-term growth of the US and European economies.

High-tech industries have often played a key role in the US economic development. But the economy is now facing a vacuum and it will take two to three years for emerging industries like new energy or biotechnology to spur investment, said analysts.

Consumption in the US rose 3.6 percent from January through March, according to the US Commerce Department, but analysts said the spending growth would be limited in the absence of employment and income growth.

The US is stepping up trade promotion under President Barack Obama's new National Export Initiative. Through the new initiative, the US plans to double its exports over the next five years and support

2 million jobs.

"If the US wants its exports to grow faster, it must rethink its strategies and lift restrictions on high-tech exports," said Chen.

Zuo Xiaolei said China could also do its part in this regard. "The Chinese government should study the new US initiative and discuss with American counterparts on what high-tech products could be exported to China ... It's an opportunity for both," he said.

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