Report says Asia to drive global growth

Stabilizing trend in continent to help ride cross-border economic initiatives

China and other Asian economies are expected to be the major drivers of global growth this year, but more efforts are needed to resolve corporate debt issues to sustain growth momentum, a survey report showed on Friday.

The Asian Economy Forward Looking Indicator, which is based on a survey of 508 economists and entrepreneurs, reached 84.1 this year, according to the report released during the Boao Forum for Asia.

Although the indicator's level falls within the moderate slowdown range (80-100), a sharp rebound of 38.7 points compared to that in 2016 promises bright prospects for a stabilizing trend in regional economic growth in Asia, according to the report.

Expected improvement in the quality of growth in the world's second largest economy this year would help the whole Asian region to play a major role in driving global economic growth, according to Zhang Yansheng, director of the Institute for International Economic Research under the National Development and Reform Commission, who led the survey.

Zhang cited data from the World Bank that Asian economies accounted for 33.84 percent of the global GDP last year, which is significantly higher than the 27.95-percent contribution made by North America and 21.37 percent by Europe.

In order to maintain the growth momentum, debt issues facing Asian economies including China need to be appropriately addressed, especially at a time when enterprises would face higher pressure to repay debts due to external uncertainties like the strong dollar, according to Zhu Min, former vice-president of the International Monetary Fund.

Li Yang, former vice-president of the Chinese Academy of Social Sciences, said debt-to-equity swap programs implemented in China would help lower the debt burden, though it takes time to see major progress.

Hans-Paul Burkner, chairman of the Boston Consulting Group, said debt issues in Asian economies have not reached an alarming level that would spark a crisis.

"Enterprises should take opportunities brought by cross-border cooperative schemes, such as the Belt and Road Initiative, to increase revenue and thus improve capacity for repaying their debts," said Burkner.