The outbreak of Severe Acute Respiratory Syndrome (SARS) has large
impact on spending, particularly on consumer spending in some Asian
countries and regions, but the impact is temporary, according to
the Citigroup Asset Management (CAM) Tuesday.
Anthony Muh, head of Investments for Asia of Citigroup Asset Group,
made the remarks at a press conference on the second quarter global
investment perspective.
He
said that the outbreak of SARS and war in Iraq greatly complicates
outlook for Asian growth and the regional growth will be slower in
2003 than in 2002, but Asian growth will beats most comers.
He
said he believed that further forecast downgrade are likely if the
epidemic last longer than expected.
Muh said consumer demand strength, which has been a feature in the
less open economies of Asia, should recover in the post SARS
period.
He
said that a number of Asian countries and regions have large
savings firepower, pent-up demand, availability of consumer credit
and easy monetary conditions.
He
said exports and consumer spending will also grow and hence even in
the most open economies.
He
said the Chinese mainland, remaining an engine of regional trade,
may only adjust forecast for its annual economic growth rate this
year from 7.5 percent to 7.3 percent.
He
said the Chinese mainland's exports and imports grew strongly in
the past few months this year and industrial output and retail
sales also witnessed an increase at the beginning of this year.
He
said countries and regions most affected by SARS will be Hong Kong,
Singapore, Malaysia and Thailand, which have high SARS incidence,
bigger share of tourism in GDP among Asian countries and where
consumer demand is large as a share of GDP.
In
those three countries and a region, the annual visitor spending all
account for over 5 percent of each region or country's GDP.
He
said a research finding of Thomson Financial Datastream and the CAM
indicated that forecast of Hong Kong's economic growth rate in 2003
may downgrade from 3 percent to 1.4 percent and that of Singapore
from 3.1 percent to 2.6 percent.
However, he said, Hong Kong has its own advantages. HK's exports
have surged at the beginning of this year, mainly due to re-exports
from China's mainland, and Hong Kong has plenty of money around,
though no one is borrowing it. As those who need money could not
afford to borrow.
He
said as far as he knew, orders of trade are still coming to the
Asia-Pacific region now and some other trade programs have just
been postponed for a while, but not canceled.
(Xinhua News Agency April 16, 2003)
