The Global Financial Crisis – Implications for Asia Dr Tony Tan Keng Yam Deputy Chairman & Executive Director, GIC 6 August 2009
Increasing signs of stabilization and recovery
Three Post Crisis Trends: Deleveraging Recessions with Financial Crises Take Longer to Normalize Source: IMF
Three Post Crisis Trends: Deflation… Source: IMF
…Then Inflation Pressure to go slow when withdrawing fiscal and monetary policy Deteriorating fiscal positions could put central banks under pressure Global labour supply will start to be less salutary Pressure from natural resources given EM demand Aging populations, uncertain productivity gains Source: IMF
Three Post Crisis Trends: Shift to EM Source: GIC
Asia has benefited from trade Source: CEIC, GS Global ECS Research
Asia has strong fundamentals and savings Source: CEIC
Asia’s banks are not leveraged Source: Nomura Research
Easy Liquidity Poses Risks to Asian Policymakers Source: Datastream
Risks and Challenges Further weakening of the US economy Weak US consumption fundamentals Increased protectionism