Finance news

The Asian economy has shown a remarkable immunity to slowing U.S. growth, so it would be richly ironic if the region were to trip up now over a byproduct of its resilience — sky-high oil and commodity prices.

A long period of turbo-charged growth, led by China and India, has boosted global energy demand, helping to drive crude to record highs above $130 a barrel. Metals and grains, most recently rice, have also been on a tear.

Producers of natural resources have spent a chunk of their windfalls on imports from Asia, replacing demand from America that has been ebbing for more than a year as the subprime mortgage meltdown ripples through the economy.

The United States, Europe and Japan still bought just over 40 percent of Asian exports in 2007, but that was down from nearly 50 percent in 2000.

Exports to Russia, meanwhile, are growing about 60 percent a year and sales to the Middle East are rising at a 35 percent clip payday advance.

As for China, Andy Rothman with CLSA in Shanghai calculates that Africa, the Middle East and Latin America now buy more of its goods than Japan and account for 20 percent of the country’s export growth — four times more than the United States.

This is a boon to companies like Fuda Faucet Works Inc, a Chinese maker of brass bathroom fixtures that sells 85 percent of its production overseas, mainly to the emerging middle class in markets such as the Middle East, Russia and Nigeria.

“We are very confident in our business model,” Wu Yiting, the Jiangxi-based company’s chief executive, said last month as she reported a doubling of sales and profit in 2007. 

Read more