News / Asia

Asia Looks for Hopeful Signs from Obama Speech on US Jobs

A construction site of the Hong Kong headquarters of China Construction Bank (Asia) is seen in front of Bank of America Tower at Hong Kong's financial Central district, August 25, 2011
A construction site of the Hong Kong headquarters of China Construction Bank (Asia) is seen in front of Bank of America Tower at Hong Kong's financial Central district, August 25, 2011
Ivan Broadhead

U.S. President Barack Obama is expected to outline his plans for boosting American employment and shoring up an economy that some analysts fear may be headed to another recession.  Although his speech Thursday is mainly aimed at Americans, the stumbling U.S. economy is of great concern in Asia, where there are expectations that growth in China  will reach a 10-year low and other nations may be economically vulnerable.

Asian countries have posted steady economic growth during much of the last decade, but the dean of business at Hong Kong University of Science and Technology, Leonard Cheng, says U.S. fiscal well-being remains crucial to the region’s continued growth.

"Asian economies are very much externally oriented. Many of them depend on exports of goods to the U.S., Europe and Japan. Since the U.S. still accounts for one quarter of the global economy, you can imagine that the U.S. is very important," he said.

Cheng expects Obama to focus on sustainable growth and job creation in his speech.  He says Asian governments are eager for the U.S. economy to once again become an engine for growth.

Singapore, which witnessed 15 percent growth last year, announced this week that it expected to move back into recession next quarter on a drop in U.S. exports exacerbated by fears about European sovereign debt.

Further north, Seoul is hoping that the U.S. Congress will ratify a Free Trade Agreement between Korea and the U.S. so both countries can benefit from a relaxation in bilateral tariffs.

However, with both Democrats and Republicans worried that it could lead to thousands more American jobs lost overseas, the deal may not have the votes to pass.

Perhaps most exposed to the U.S. downturn is China.  More than 20 percent of its total exports are bought by U.S. consumers and Beijing holds $1.2 trillion of U.S. Treasury Bonds.   Cheng calculates that exports from China to the United States still account for between four and six percent of China’s GDP.

This week Huang Guobo, chief economist with the State Administration for Foreign Exchange, reported that China’s growth is softening and could fall below nine percent next quarter, its slowest rate since 1991.

Cheng argues that Asian governments, particularly Beijing, must satisfy themselves with a more gradual rate of growth. He says Americans have to change their consumption habits if the President’s plans are to be effective.

"Work harder, yes, but consume a little bit less so that they can have enough savings to pay off their debt - at least not let their debt grow larger and larger. And, Asians need to be aware that this is good for the U.S. and good for them too in the long term. Even though in the short term, everyone wants to sell as much as possible to the United States," said Cheng.

World Bank President Robert Zoellick said Monday that he hopes China can boost global economic growth by expanding domestic demand and reducing its reliance on exports.

Sophie Leung, a Hong Kong legislator and deputy to China’s National People’s Congress, says she is confident that China can play a role in assisting the U.S. recovery as increasingly affluent consumers look to purchase American goods.

"As the new 12th Five Year plan indicated, China would like to divert from export to import. And, I think this is something that President Obama might be catering his speech towards; tapping that [demand]. As China’s consumers start waking up, [they will] want choice, and I think American products have a lot to offer, beyond just Coca Cola and jeans," she said.

For poorer Asian countries, cuts of more than 40 percent to U.S. development budgets could take a more serious toll on vulnerable economies.  Cheng says regional instability could become a concern the longer it takes the United States to struggle back to profitability.

"I think Asian governments already are under pressure now because of inflation and a very uneven income distribution and wealth distribution," said Cheng.

After President Obama’s address, attention will likely shift to Friday’s G7 meeting in Marseille for a further indication of how the United States and other leading economies can collectively support global growth and job creation.

You May Like

How to Safeguard Your Mobile Privacy

As the digital world becomes more mobile, so too do concerns about eroding privacy and increased hacking More

'Desert Dancer' Chronicles Iranian Underground Dance Troupe

Film by Richard Raymond is based on true story of Afshin Ghaffarian and his friends More

Obesity Poses Complex Problem

Professor warns of obesity’s worldwide health impact More

This forum has been closed.
Comments
     
There are no comments in this forum. Be first and add one

Featured Videos

Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
Rolling Thunder Run Reveals Changed Attitudes Towards Vietnam Wari
X
Katherine Gypson
May 25, 2015 1:32 AM
For many US war veterans, the Memorial Day holiday is an opportunity to look back at a divisive conflict in the nation’s history and to remember those who did not make it home.
Video

Video Rolling Thunder Run Reveals Changed Attitudes Towards Vietnam War

For many US war veterans, the Memorial Day holiday is an opportunity to look back at a divisive conflict in the nation’s history and to remember those who did not make it home.
Video

Video Female American Soldiers: Healing Through Filmmaking

According to the United States Defense Department, there are more than 200-thousand women serving in the U.S. Armed Forces.  Like their male counterparts, females have experiences that can be very traumatic.  VOA's Bernard Shusman tells us about a program that is helping some American women in the military heal through filmmaking.
Video

Video Iowa Family's Sacrifice Shaped US Military Service for Generations

Few places in America have experienced war like Waterloo. This small town in the Midwest state of Iowa became famous during World War II not for what it accomplished, but what it lost. As VOA’s Kane Farabaugh reports, the legacy of one family’s sacrifice is still a reminder today of the real cost of war for all families on the homefront.
Video

Video On Film: How Dance Defies Iran's Political Oppression

'Desert Dancer' by filmmaker Richard Raymond is based on the true story of a group of young Iranians, who form an underground dance troupe in the Islamic Republic of Iran. This is the latest in a genre of films that focus on dance as a form of freedom of expression against political oppression and social injustice. VOA’s Penelope Poulou has more.
Video

Video Turkey's Ruling Party Trying to Lure Voters in Opposition Stronghold

Turkey’s AK (Justice and Development) Party is seeking a fourth successive general election victory, with the goal of securing two-thirds of the seats in Parliament to rewrite the constitution and change the country's parliamentary system into a presidential one. To achieve that, the party will need to win seats in opposition strongholds like the western city of Izmir. Dorian Jones reports.
Video

Video Millions Flock to Ethiopia Polls

Millions of Ethiopians cast their votes Sunday in the first national election since the 2012 death of longtime leader Meles Zenawi. Mr. Meles' party, the Ethiopian People's Revolutionary Democratic Front, is almost certain of victory again. VOA's Anita Powell reports from Addis Ababa.
Video

Video Scientists Testing Space Propulsion by Light

Can the sun - the heart of our solar system - power a spacecraft to the edge of our solar system? The answer may come from a just-launched small satellite designed to test the efficiency of solar sail propulsion. Once deployed, its large sail will catch the so-called solar wind and slowly reach what scientists hope to be substantial speed. VOA’s George Putic reports.
Video

Video FIFA Trains Somali Referees

As stability returns to the once lawless nation of Somalia, the world football governing body, FIFA, is helping to rebuild the country’s sport sector by training referees as well as its young footballers. Abdulaziz Billow has more from Mogadishu.
Video

Video With US Child Obesity Rates on the Rise, Program Promotes Health Eating

In its fifth year, FoodCorps puts more than 180 young Americans into 500 schools across the United States, where they focus on teaching students about nutrition, engaging them with hands-on activities, and improving their access to healthy foods whether in the cafeteria or the greater community. Aru Pande has more.
Video

Video Virginia Neighborhood Draws People to Nostalgic Main Street

In the U.S., people used to grow up in small towns with a main street lined by family-owned shops and restaurants. Today, however, many main streets are worn down and empty because shoppers have been lured away by shopping malls. But in the Del Ray neighborhood of Alexandria, Virginia, main street is thriving. VOA’s Deborah Block reports it has a nostalgic feel with its small restaurants and unique stores.

VOA Blogs