06/12/2015
Global / Economics
Asia’s investment growth has slowed to a crawl. Investments at home must be raised to turn this trend around or the Asia growth story ends
Asia’s investment growth has slowed to a crawl. That’s bad because saving and investing is what gives you – anyone – faster growth and higher incomes. Double-digit savings and investment rates underwrote 7% per-capita income growth in Asia for decades. At that rate, wages and salaries double every ten years.
In this report by DBS, we explore how the real investment growth in Asia has slowed from an 11% pace in 2008 to 6.5% on average in 2009/10, 5% in 2012, 4% in 2013, and below 3% in 2014. Either this gets turned around or the Asia growth story ends.
Key points in this report include:
- Real investment growth has slowed from 11% in 2008 to below 3% in 2014
- It’s not about guarding against ‘over-investment’, it’s about arresting its slide
- Lack of funds isn’t the problem, but current account surpluses
- How can investment at home be raised? Stop lending, start borrowing
Read the full report
