Good morning. Here's my take on some of the stories driving the debate in politics, finance and social issues across Asia today:
ADB sees smooth sailing in 2015.
Chinese slowdown? Federal Reserve tapering? No problem, says the Asian Development Bank in a new assessment of risks for 2015. The lender upped its forecast for developing Asia to 6.4 percent next year from 6.2 percent this year. “We’re expecting some pickup this year and next, helped by the recovery in major industrial economies particularly the U.S., with some balancing from moderating growth in China,” says economist Joseph Zveglich. It's entirely possible the ADB is being too sanguine about a big Chinese contraction or the Fed over-tightening. But for now, Asia can bask in the knowledge that the risks of emerging-market meltdown have receded.
Roubini offers a China counterargument.
Or can it? Nouriel Roubini's glass is more of the half-empty variety. You might expect that from an economist known as “Dr. Doom,” but then risks of a Chinese hard landing shouldn't be dismissed. The worry is that Beijing's obsession with keeping growth above 7 percent is resulting in bad decisions today that threaten tomorrow. A key purchasing managers’ index fell to 48 in March, the lowest reading since July, increasing the odds of fresh stimulus. "This then leads to more bad assets and non-performing loans, more excessive investment in real estate, infrastructure, and industrial capacity, and more public and private debt," he writes in this Project Syndicate op-ed. "By next year, there may be no road left down which to kick the can."
Abenomics: the good, bad, the yet-to-materialize.
It's "T" day in Tokyo, the dreaded moment when a jump in the sales tax to 8 percent from 5 percent tests the durability of Prime Minister Shinzo Abe's revival program. The hike elicited a plethora of whither-Abenomics analyses, many warning it will kill what little growth Japan has. But just for good measure, here's the bullish take on Japan's chances from JPMorgan Chase's Jesper Koll. "On a scale of one to 10, I think they probably deserve an eight out of 10. They can always be more aggressive, policies can always be implemented faster with a greater sense of urgency, but overall Japan is the one country where the government is very focused on promoting economic growth, not just by printing money but by also having a growth policy." If Koll's right, he'll earn the moniker "Dr. Boom" to balance out Roubini.
Climate-change war in Asia?
"The worst is yet to come." That's the unmistakable message from the UN's Intergovernmental Panel on Climate Change, which is meeting in Yokohama this week. That's particularly true of Asia, which is on the front lines of depleted water resources and food shortages. But war? The UN panel warns that the many side effects of climate change raise the odds of armed conflict among China, Bangladesh, India and Pakistan. "Climate change is already becoming a determining factor in the national security policies of states," according to UN officials, who hope to strike a global climate deal by 2015. Let's hope they succeed, for all our sakes.
Court calls Japan on whaling fudge.
It was always a loophole within a loophole. Since 1988, Japan has steered around a global moratorium on whaling by arguing that the roughly 13,000 creatures it's killed are for scientific-research purposes. Of course, when you ask Japanese officials where one can find all those research reports, all those amazing breakthroughs, generated by the program, you get blank stares. Well, not anymore, thanks to the International Court of Justice. It ordered Japan to halt annual hunts that do far more damage to its global reputation than the money made from selling whale meat is worth. Now if we could only get the western town of Taiji to rethink its notorious annual dolphin hunts, Japan's "soft power" might get a much-needed boost.
(William Pesek is a Bloomberg View columnist. Follow him on Twitter at @williampesek.)
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