Asian economies are not immune and will not be entirely spared from the effects of the global economic slowdown, Hong Kong Monetary Authority (HKMA) Executive Director Hans Genberg said Thursday, hoping the pledge made by G20 leaders followed by concrete actions.
"Our integration with and dependence on the wider world economy is such that we must hope the pledge made by all G20 leaders at their meeting last weekend in Washington will be followed up by concrete actions to stabilize the world's financial markets, to stimulate aggregate demand for goods and services, and to keep an open international trading system," Genberg said in the HKMA's weekly Viewpoint column.
He said the close link between the region's economic fortunes and those of the United States and Europe stands in sharp contrast to predictions made.
Noting the region's exposure to the rest of the world's economic fortunes is not only determined by trade flows, Genberg said the current financial turmoil is reminding us financial market linkages show a disturbance in one part of the system will rapidly spill over to other parts.
While the banking systems in Asia were not greatly exposed to sub-prime assets, liquidity dry-up in the U.S. and Europe affects money markets, including Hong Kong, he added.
(Xinhua News Agency November 21, 2008)