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The Asian recovery

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The good news? Global demand is rebounding. The unexpected news? It's not coming from the rich countries. Howard Schneider explains:

"We have seen demand rebound, but it is very much supported by emerging countries: China, India, Indonesia," said Masanori Kudo, senior vice president at Showa Denko, a Japanese conglomerate. Its Singapore-made hard-drive components are shipped to computer makers in such places as Taiwan for final assembly, an example of how production has been integrated across the region.

The addition of rising Asian consumer demand, the IMF reported recently, marks a historic turn.

"This is the first time Asia is leading a global recovery," the IMF wrote in a recent report, with growth based not just on exports but also on "resilient domestic demand" and a strong surge in investment.

It is, of course, a good thing that there are other countries able to stimulate global demand right now. The problem is that these countries aren't demanding the more high-tech goods that we produce. That's why their rapid development is a good thing, not a bad one, for American consumers. Our politicians like to talk ominously about China "catching up," but if China does catch up, that means they'll buy a lot more of our stuff.

By Ezra Klein  |  May 14, 2010; 3:46 PM ET
 
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Comments

They're going to buy more of our stuff? What? Predator drones? Neutron mortgages?

I'm sorry, but you have to be more specific. What exactly do we produce that China will purchase? Forgive me, but beyond commercial airliners, I just don't see it.

But I can be convinced, if you stop talking like Thomas Friedman.

Posted by: Dollared | May 14, 2010 4:58 PM | Report abuse

Amen - the rapid development of emerging economies is absolutely a good thing for American business, American workers, and American consumers for all kinds of reasons. And the process of development is happening organically, from the bottom up, based in part on the technologies and platforms that America is exporting to the rest of the world. If this subject interests you, check out www.youngworldrising.com

Posted by: robsalk | May 14, 2010 5:29 PM | Report abuse

@Dollared,

CFR has an interesting chart that shows that most of what the US exports to China are machinery and transport equipment, and crude materials.

One factor contributing to [the trade imbalance] is U.S. export controls on certain high-tech products deemed important for national security. As illustrated in the chart above, the United States now exports to China relatively less machinery and relatively more crude materials, such as scrap metal, than it did a decade ago. China’s president Hu Jintao has urged the United States to relax technology export controls for years.

Meanwhile, US exports to China doubled from January 2009 to December 2009, while US imports from China increased by less than 10%.

Posted by: Factaaa | May 14, 2010 6:08 PM | Report abuse

If the US were more interested and engaged in helping Mexico catch up to us, it would go a long way toward improving immigration policy. The fact is that US business wants cheap, black market, migrant labor.

Posted by: bcbulger | May 14, 2010 7:00 PM | Report abuse

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