East Asia continues its economic growth in spite of financial crisis

When you look broadly at the worldwide economic situation and consider where the global electronics business slots in, it’s quite plain to see that East Asia occupies a very unique and enviable position in the maelstrom.

The regions least affected by recession in 2011 include Africa, Latin America, the Middle East and Australia. Even Poland is enjoying a peculiar oasis of economic growth in the middle of an otherwise universally depressed Europe. But no other region, not even India, is as financially buoyant as East Asia.

This region also happens to be the world epicentre of mainstream electronics production. And, as becomes obvious when you try to count the number of loudspeaker, console or amplifier manufacturers that haven’t outsourced the majority of their production to this region, professional audio equipment is no exception.

While many parts of East Asia can be considered developing areas, they are in fact developing so fast that the crisis merely feathered their brakes. Now that the West is on the road to recovery, consumer confidence is creeping back and the East Asian factories are whirring to life. Consequently, many countries in the region are accumulating enough capital to re-invest in the development of electronics, and with stages of economic growth tugging at the coat tails of Western countries, domestic demand for these products is up, too.

In fact, growth in East Asia is so high that, during a presentation to the Council on Foreign Relations in New York earlier this year, the World Bank Chief Economist Justin Yifu Lin said that it might need to slow down to address inflation. “I am confident East Asia and South Asia will still be the highest growth region in the world, but if we want to generate enough demand for investment goods, we need to have growth in high income countries, as well as other regions,” he said.

As far as the pro audio markets are concerned, East Asia is offering an alternative solution to Lin’s problem. It seems that when it comes to this class of product, East Asia likes to give just as much as it does to receive – according to the latest statistics from China Customs, the import of audio products in 2010 rose to USD 2.4 billion (16.75 per cent more than in 2009), reflecting the strong demand for imported equipment. This demand is expected to increase, as the purchasing power in China will almost certainly remain strong in 2011.

Broadly speaking then, it would appear that East Asia has proved an advantageous place to base a pro audio manufacturing or distribution business.