A Sun Rising In the East

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As always in Asia, the broad-brush picture hides many fine details. Hong Kong and Singapore aren't seeing as strong a growth in consumer spending as elsewhere. In Hong Kong, especially, perceptions of household wealth have always been tied to the property market, and because property prices have been slumping since 1997--with no end in sight--people just don't feel rich. While I was visiting there last month, the unemployment rate rose to 7%, the highest since 1981. In many years of trips to Hong Kong, I can't remember a time when the economic sentiment of those I talked with was quite so gloomy. Farther afield, there continues to be real doubt as to whether India and China can generate the growth needed to find jobs for their ever expanding populations.

But in most of the region, the prospects are encouraging. U.S. businesses still find Asia an attractive place to build plants. Given trade liberalization in China and rising consumer spending in most of Asia, persistent American firms are being rewarded with fresh demand for their products.