According to a survey of attendees at the Asian Financial Forum (AFF) in Hong Kong yesterday, financial experts from around the world have also expressed concerns about a Chinese economic slowdown, increased geopolitical tensions and an oil-price collapse.
On the other hand, they are still optimistic about the prospects of strong economic growth in the Asia-Pacific region over the next five years, supported by favourable factors such as China's "Belt and Road Initiative" involving a development fund worth an estimated US$40 billion (S$57.5 billion) as well as the Trans-Pacific Partnership (TPP) and Regional Comprehensive Economic Partnership (RCEP) agreements.
Dr Zeti Akhtar Aziz, governor of Bank Negara, Malaysia's central bank, told the conference that capital outflows from the region and financial-market volatility after the US interest-rate increase were expected to be temporary, but Asian economies should take this opportunity to renew their structural-reform efforts, especially in education and labour, to achieve more innovation and productivity.
This would help Asian economies cope better with future external shocks, she said, adding that the global trend of low economic growth was likely to prevail for some time, so reforms and flexibility were crucial.
She also said the consequences of a global collapse of oil and commodity prices would linger for some years, but she expressed confidence that China's economic-growth trajectory for the medium term remained sound.
Kiatchai Sophastienphong, Thailand's vice minister for finance, told the AFF that the country now offered a long list of opportunities for international investors after the stabilisation of domestic politics, with a general election due in the next year and a half.
He said 2016 would be an important year for public and private investment projects as the government had offered many incentives to drive the country's economic growth to 3-3.5 per cent.
Easing business operation
Thailand has also taken actions to make doing business in the country easier, while a total of 10 future industries including smart and green automobiles, electronics, healthcare and tourism are being promoted.
Kiatchai also said Thailand's railway and highway linkages with neighbouring countries in the ASEAN Economic Community (AEC) and southern China would offer new opportunities, as would the 600-million population of the AEC single market.
He also expressed Thailand's support for the China-led Asian Infrastructure Investment Bank (AIIB), which started operations on Saturday.
The AIIB is expected to approve the first batch of loans for infrastructure projects in Asia within six months.
Leung Chun-ying, chief executive of Hong Kong, said the Asia-Pacific region had witnessed uncertainties after the US interest-rate rise and China's stock-market rout at the start of 2016, but Asia still had strong potential to shape a new paradigm for global growth.
He cited China's Belt and Road Initiative, the setting-up of a Silk Road development fund worth $40 billion and the AIIB as mechanisms to drive growth in coming years.
According to Leung, Hong Kong is being positioned to play a crucial role in connecting China with the rest of the world, especially in the wake of internationalisation of the Chinese yuan and its new status as a currency of the International Monetary Fund's Special Drawing Rights facility.
Despite a slowdown of the Chinese economy, the world's second-largest after the US, Pierre Gramegna, Luxembourg's finance minister, said China's growth rate of 6 per cent was still double the world's average and more than double the United States' forecast growth rates of 2.7-2.9 per cent for this year, making Asia the world's fastest-growing region.
Arkady Dvorkovich, Russian deputy prime minister, told the conference that he believed in the strong economic potential of Asia and the Pacific.
Chinese Vice Foreign Minister Liu Zhenmin said the Belt and Road Initiative had been well received by 70 countries in Asia and Europe and would provide a win-win scenario for all parties concerned.
Liu said China and Russia had signed a Silk Road economic-zone agreement, while European countries and China had set up a joint fund to get involved in infrastructure development projects.