Reply #60: Asian Consumers, Giving Up Frugal Ways, Fuel Growth, Investment

[54anickel]

http://www.bloomberg.com/apps/news?pid=10000086&sid=auU6O11rRw4A&refer=latin_america

April 10 (Bloomberg) -- Asia's export-driven economy has a new engine of growth: its own people.

With unemployment low and wages rising, Asian consumers are spurning the thrifty ways of their parents and turning out to buy. In Japan, spending rose the fastest in nine years in 2005. In South Korea, consumer confidence climbed near a four-year high in the first quarter. Even China expects domestic demand to contribute more to growth this year after cutting income taxes and raising minimum wages to pump up consumption.

The rise of the Asian consumer helped prompt the International Monetary Fund to increase forecasts for economic growth for the region and worldwide this year, fund officials said at a conference April 4 in Cambodia. Asian stock markets are booming, led by India's, as investors bet that stronger domestic demand will help the region reduce its dependence on consumer spending in the U.S. and Europe.

``We're looking for opportunities that will arise as we see the emergence of a middle class in China, the expansion of the middle class in India and an enrichment of the middle class in South Korea,'' says Michael Nock, managing director of Doric Capital Corp., a Hong Kong-based hedge fund.

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