Asian share markets have tumbled again because of renewed fears of a prolonged global recession. In Sydney, however, some financial experts say the Australian and Japanese economies may well escape the worst of the international financial meltdown. From Sydney, Phil Mercer reports.
It has been another day of carnage on Asian stock markets.
Japan's Nikkei index fell by almost seven percent Thursday, while Hong Kong's Hang Seng dropped by more than four percent.
There were large falls too in South Korea, as share prices slumped in line with other Asian markets following a big drop overnight on Wall Street.
Markets in Australia, India and Taiwan were lower too, adding to a general sense of despondency over a drawn-out global recession.
The mood on the markets was not helped by data showing that Japan's exports to its neighbors in Asia dropped last month for the first time since 2002.
At the annual Australia-Japan Economic Outlook Conference in Sydney, bankers and government officials have been assessing the crisis.
Several economists think that Japan's economy, which is in recession, will start to recover by the end of 2009. Australia, which analysts say should escape the worse of the global instability, will is expected to endure slowing growth.
Conference organizer Manuel Panagiotopoulos says there was a distinct sense of gloom at the high-powered meeting.
"The general mood was very somber. Japan is in recession but it seems to be a fairly mild recession," he said. "Luckily the Japanese financial system isn't suffering very much from the global credit crisis because the Japanese banks are well capitalized and they had very little exposure to sub-prime problems. Australia seems to be in a similar kind of position. We're having a sharp downturn but we'll do relatively better than other countries."
That is a view shared by Australia's Reserve Bank chief Glenn Stephens. He said Thursday that countries with responsible monetary and fiscal policies would be better able to cope with the current climate because they have more scope to stimulate faltering economies.
Not everyone is so optimistic. Economists at leading Australian bank Westpac forecast that the country may fall into recession next year.