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From Komfie Manalo, Opalesque Asia:
A study commissioned by the Manila, Philippines-based Asian Development Bank (ADB) showed that the global financial crisis reduced the value of financial assets across the world by at least $50tln in 2008, with Asia suffering more than other emerging markets.
The study entitled “Global Financial Turmoil and Emerging Market Economies: Major Contagion and a Shocking Loss of Wealth?” said that Asia, excluding Japan, lost about $9.6tln, or just over one year’s worth of the region’s gross domestic product (GDP). Latin American lost $2.1tln or 57% of its GDP.
In a statement posted on the bank’s web site, ADB’s president Haruhiko Kuroda described the crisis as the most serious to hit the world economy since the Great Depression and that no region or country was insulated from it. But Kuroda said Asia would be one of the first regions to emerge from the recession.
The study added that the global stock markets had lost about $28.7tln in 2008, and another $6.6tln had been wiped from the value of world equities this year.
Claudio Loser, a former International Monetary Fund director and the author of the report that was commissioned by the ADB, predicted that net capital flows to emerging markets may fall to $165bn this year, from $470bn in 2008 and a record $930bn in 2007. That means that net flows to emerging Asian economies may drop by almost 83% from the peak in 2007
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