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Nations that are out of recession

Last updated on: August 18, 2009 

Nations that are out of recession

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The world is slowly, but surely, coming out of the fiscal quagmire that it was wallowing in for a long time.... the recession is finally showing signs of retreating with economies across the world fighting the crisis with a vengeance.

But it is primarily the Asian giants that are pulling back the world economy from the perils of recession.

Asia's four emerging economies, China, Indonesia, South Korea and Singapore have seen their economies grow, even as the world reels under a recession.

The GDP figures of these countries for the second quarter grew by an average annualised rate of more than 10 per cent, while America's GDP fell by 1 per cent, according to The Economist

Japan's economy has also rebounded after going through one of its worst phases. The emerging Asian economies are likely to grow by 5 per cent.   On the other hand, the economies of most South Pacific islands are expected to contract this year due to weak tourism and remittances, according to the Asian Development Bank (ADB).

Goldman Sachs has raised its 2009 GDP forecasts for Hong Kong, Malaysia, the Philippines, Singapore, South Korea and Taiwan.

There are positive signals for India too. The Indian economy has bottomed out and is set for positive growth in 2010, according to Standard & Poor's.  It has pegged India's GDP growth in the 5.8-6.3 per cent range this year and 6.8-7.3 per cent range in 2010.

Goldman Sachs raised India's GDP growth forecast to 7.8 per cent for fiscal 2011 from 6.6 per cent based on a better investment outlook and external environment and recovery in demand.

A look at the major economies showing signs of revival amidst global gloom...

Image: Two man read information on an electronic screen at a brokerage house in Shanghai.
Photographs: Aly Song/Reuters
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Japan

After falling into one of the worst recessionary phases after the World War II, Japan's economy has returned to growth in the second quarter of this year.

The gross domestic product (GDP) grew 0.9 per cent in April-June quarter. So Japan is the first among the G7 countries that have managed to tide over the crisis, along with Germany and France.


Image: A salesman promotes television sets to visitors at an electronics shop in Tokyo.
Photographs: Kim Kyung-Hoon/Reuters
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China

While debates still continue about the veracity of China's GDP figures, the National Bureau of Statistics (NBS) reported that in the second quarter that the Chinese GDP grew 7.9 per cent year on year, from 6.1 per cent in the first quarter.

On August 6, the Chinese State Information Centre released an estimate on the economic performance in the second half, expecting the GDP to grow 9 per cent in the third quarter and 10 per cent in the fourth quarter, year on year.

Goldman Sachs said Asia as a whole would benefit from China's strengths. Sachs expects China to grow 9.4 per cent this year and 11.9 per cent in 2010.


Image: Chinese currency.

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India

Despite a fall in exports and industrial production, India managed clock a 6.7 per cent GDP growth in 2008-09.

Planning Commission Deputy chairperson Montek Singh Ahluwalia said the global financial crisis would slow down India's GDP growth to just 6.5 per cent in the second half of this fiscal.

"India will see 6.5 per cent growth in second half of this fiscal. Growth has been targeted at seven per cent in financial year 2010 as the global economy will revive in the second half of 2010 on the back of various stimulus measures," Montek said.

Meanwhile, Finance Minister Pranab Mukherjee said India would be back in the 9 per cent growth trajectory in the next one and a half years as a result of stimulus measures announced by the government.


Image: Family members of unemployed diamond workers raise slogans.
Photographs: Amit Dave/Reuters
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Hong Kong

Hong Kong's GDP grew by 3.3 per cent during the second quarter of 2009, according to the Hong Kong Census and Statistics Department.

The economy went through four successive quarters of economic recession. Hong Kong has now revised its 2009 economic forecast to a drop of just 3.5 per cent.

On a year-on-year basis, the real GDP fell by 3.8 per cent compared with 7.8 per cent in the first quarter of the year.  Hong Kong's export market has also improved.


Image: Job seekers go through vacancies beside a monitor at a Labour Department job centre in Hong Kong.
Photographs: Bobby Yip/Reuters
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Singapore

Another Asian giant, Singapore's GDP grew 20.4 per cent in the last quarter compared to the January-March period, after four consecutive quarters of contraction.

The economy fell by 3.7 per cent from compared to last year with a 9.6 per cent fall in the first quarter.

The government now expects the economy to drop by 4-6 per cent for the full year compared with a earlier forecast of 6-9 per cent.


Image: A tourist boat travels near the Merlion statue overlooking the Marina Bay Sands Casino site.
Photographs: Tim Chong/Reuters
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Indonesia

Indonesia's economy grew by 4 percent in the second quarter, its slowest annual pace in nearly six years but faster than expected.


Image: Indonesia on the growth track.

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S Korea

South Korea's economy grew at the fastest pace in more than five years during the second quarter. The country's exports and household spending increased boosting the economy.

The GDP grew by 2.3 per cent from the first quarter.  A hike in government spending and low interest rates helped the economy.


Image: Workers from the labour union of Ssangyong Motor participate in a rally at the company in Pyeongtaek
Photographs: Reuters
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Germany

Germany's gross domestic product (GDP) rose by 0.3 per cent in the second quarter, bringing an end to the country's biggest recession since the second World War II.

It has also revived hopes of a recovery in the Euro zone. Despite Germany and France's unexpected growth, the European Union saw an overall drop of 0.3 per cent.

The economic growth was down 4.6 percent and 4.8 percent respectively in the 16-nation euro zone and the 27-nation EU, compared with the same period last year according to Eurostat estimates.


Image: Germany revives hopes for Euro zone.

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France

France also gave a surprise with its GDP figures. The Euro region's second-biggest economy expanded at an annualised rate of 1.4 per cent.

Both France and Germany had contracted during the last four quarters, and bounced back earlier than the US and the UK, which are yet to see a rise in growth.

The growth in France and Germany was pushed by stronger exports, consumer spending and government stimulus packages.


Image: France bullish on growth.

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Russia

Russia's GDP rose by 7.5 per cent quarter-on-quarter in April-June 2009, but fell by 10.9 per cent year-on-year.

Russia expects GDP to grow in the third quarter as compared to the second quarter.


Image: Russia expects higher growth.

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