China is well placed among world emerging economies to weather the global economic downturn that has begun to infect many developing countries, Alex Patelis, head of international economics at Merrill Lynch, told Xinhua in a recent written interview.

With a high level of reserves, room for policy easing, strong savings rate and low leverage, China's economy is healthy enough to withstand the forthcoming external risks as the world's emerging economies see a significant plunge in equity and currency markets, the economist said.

Considering the advantages of China's economy, Patelis put it on the priority list to receive an asset allocation or portfolio in the worldwide market if they were available in 2009. The economist also included Japan and Brazil on the list.

Patelis said the major causes of the international financial crisis included overdraft consumption, interest policy and regulation deficiency of policy makers, weakness of human nature, interest conflicts of rating organizations and flaws in international accounting standards.

The economist mostly attributed the decline in oil prices, which have fallen by 60 percent since mid-July, to a demand-supply correction.

"Demand in nearly all countries in the world has fallen sharply at the same time, while supply next year is expected to expand," he said.

Patelis also predicted that the US dollar will continue to strengthen through the first half of next year and then weaken, particularly against emerging market currencies, in the second half.

(Xinhua News Agency January 4, 2009)