By Manik Mehta
NEW YORK, May 15 (Bernama) -- Even as the global economic downturn impacts the Asia-Pacific region, it will still be the world's fastest growing while proving to be an anchor of stability for the world economy, a report by the United Nations (UN) says.
The report, 'Economic and Social Survey of Asia and the Pacific 2012: Pursuing Shared Prosperity in an Era of Turbulence and High Commodity Prices', cautions that commodity price volatility is another major worry for the Asia Pacific which faces a long-term trend of rising commodity prices.
Compiled by the UN Economic and Social Commission for Asia and the Pacific(ESCAP), the report also suggests that the growth rate of developing economies in the Asia-Pacific, will slow down to 6.5 per cent in the current year, a dip from the 7 per cent in 2011 and 8.9 per cent in 2010.
However, a key advantage of the slow growth is the resulting lower inflation rate in the region, which is expected to be tempered from a 6.1 per cent surge in 2011 to 4.8 per cent this year.
Noeleen Heyzer, ESCAP's executive director, said while presenting the report at a meeting in Bangkok recently, that the Asia-Pacific would continue to face a "challenging external environment", which is why the focus of the 2012 survey is to map the landscape to help steer it through turbulence and volatility.
Even though the slowdown will cast its shadow on growth, the region's economic dynamism is expected to continue as the Chindia factor will play a crucial economic role in the future as well.
China's growth is expected to touch a strong 8.6 per cent and India around 7.5 per cent in the current year.
Many UN-based experts are also optimistic about the Association of Southeast Asian Nations (ASEAN) which is seen as a growth region with an attractive market of a combined 600 million population.
Heyzer predicted that South-South economic and trade interaction with the Asia-Pacific in 2012 will help other developing regions such as Africa and Latin America further reduce their dependence on "low-growth developed economies", a euphemism for the traditional markets of the developed countries.
The report also cautions about the challenges and options lying ahead for the Asia-Pacific economies which will have to balance between growth and inflation, coping with capital flows, and dealing with exchange volatility, and fixing the burgeoning unemployment problem.
It observes that the region would have to aim for more inclusive growth. This is given that levels of income inequality have grown by 15 per cent in developing countries of the Asia-Pacific since the 1990s.
Income disparity is also obstructing social progress in the Asia-Pacific region, according to Heyzer.
Thus, a high priority task is to ensure the creation of additional jobs.
The report highlights that more than one billion workers in the Asia-Pacific region are in "vulnerable employment", meaning jobs that are considered "fragile" and can be easily lost, as developing countries fail to generate sufficient work opportunities in the formal sector.
Indeed, young people are three times more likely to be unemployed than adults with the region's youth unemployment rate projected to remain at 10.2 per cent in 2012.
Meanwhile, another report from the UN Development Programme (UNDP) warns that the Asia-Pacific cannot afford to "grow first and clean up later", the reference being to the huge environmental problems growth is creating.
The UNDP report recommends that as the region prospers economically, it should also take steps to protect the environment and create jobs for the poor in its manufacturing, farming and energy generation activities.
The report,' One Planet to Share', was authored by a team led by the UNDP head Anuradha Rajivan, who observed that since the Asia-Pacific comprised more than half of the world's population and one-third of the earth's landmass, its actions would impact the entire world.