Asia: one short-term solution to the crisis?

The economic and financial crisis has not yet shown its real dimension in Brazil and there is still a little hope that it affects less than the country has affected the rest of the world. However, to follow what happens in the major world economies, the scenario that emerges requires care and, about everything, the need to prepare for more turbulent times for world trade.

It is not known for sure what the final profile that current trends present: scenarios ranging from recession to the sharp decline in the growth rate of the world economy. However, businesses and governments begin to take a series of measures to anticipate possible negative impacts, which certainly modifies the strategies adopted by each.

In the USA, center of the crisis and one of the most important players in the international economy, projections indicated by the Federal Reserve (Fed) show a rather fearful scenario for 2009: the US economy will shrink anywhere from 0,5% e 1,3%. Part of this fall will be a result of the decrease in exports to, in its turn, results in an average drop in global economic activity.

To give an example, the agricultural sector should export 20 billion dollars less in 2009, when compared to the results achieved in 2008, totaling an export 95,5 billions of dollars. On the other hand, it is expected that Chinese growth remains between 5% e 5,5% in 2009, relatively low value compared with the growth that the country had held since the beginning of the 1990.

Even so, in the context of the crisis, this growth can be exciting, It is further analyzed jointly to the growth of 1,8% expected or Asia. In addition to China, India and Indonesia emerge as pivotal to maintaining a positive picture of growth in the region. Thus, you can see that this is a region that is likely to gain prominence in business strategies 2009, They may attempt to occupy the area of ​​growth.

However, while that arises as a possible performance space, It is also expected to further closure of the region to the rest of the world trade. This will occur due to the high pressure sales in the region. Two should be the fronts of Asian countries to avoid the "flow" of goods stranded worldwide: (1) maintenance and, sometimes, increase in subsidies offered mainly to the agricultural sector and (2) emergence of trade barriers and tariff nature, about everything, non-tariff (techniques, health, phytosanitary, environmental and labor).

In this scenario, the Asian region appears as a short-term alternative to allow businesses to try to dispose of its production, but the strategy should be more focused on local partnerships, able to reduce the impact of barriers. Direct exports are unlikely to be sufficient to offset the investment of open markets at a time when the political and commercial instability prevails.

Originally published in FinancialWeb

http://www.financialweb.com.br/blogs/blog.asp?cod=98