Heating Up: Are Asia’s Markets Overheated or Sustainable Growth Engines?
All eyes are on Asia as investors assess what effect the global slowdown has had on the region. Fears of a hard landing in China have worried its Asian neighbours while the European sovereign debt crisis has been a constant cause for concern. While Asia continues to be one of the most exciting regions in terms of economic growth and rising dominance on the world stage it has not been immune from the global economic slowdown. The biggest impact has been on exports. For the first nine months of 2012, exports from Japan and China to the European Union were down by 14 percent and 6 percent year-on-year, respectively. Meanwhile, exports to the United States by major Asian economies have grown at a much slower pace. In addition, the volatility in the capital markets has affected sentiment while Asian economic growth has softened since the beginning of 2012. There are now question marks hanging over Asia with regard to its future growth and whether investors should still be increasin