China as an Engine of Recovery and Growth for Asia |

China as an Engine of Recovery and Growth for Asia


Export-dependent East Asia is looking for new sources of growth in the wake of the global crisis, which has weakened the import appetite of US and other industrialized countries. In this connection, many Asian countries are now looking to large and rapidly growing China as a new engine of growth. The central objective of this paper is to use a two-pronged approach – (1) estimate a VAR model and (2) examine the structure of China's trade – to assess the empirical validity of the China-as-engine hypothesis. While our VAR results cast doubt on the China-as-engine hypothesis, China's recent trade patterns indicate that China is beginning to become an independent source of demand for the rest of Asia. This provides some grounds for optimism about the prospects of trade with China as a source of resilience against external shocks in the short run and an additional source of growth in the long run.

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Donghyun Park, Senior Economist, Economics and Research Department, Asian Development Bank

Tuesday, 03 November 2009
5.15 p.m. - 6.30 p.m.

Seminar Room 2-1
Level 2, Manasseh Meyer
Lee Kuan Yew School of Public Policy
469C Bukit Timah Road
Singapore 259772

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