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SINGAPORE : Barack Obama's successful presidency bid will have a mixed effect on Asian economies.
The US dollar is likely to be far stronger than it would have been under a John McCain administration, due to Obama's less aggressive stance on tax cuts and an expected pullback in expenditures for Iraq.
Leon Perera, group MD of Spire Research & Consultancy, said: "The US dollar weakened a great deal in the early part of this year, though it rallied a lot in past two months. Generally, under Obama, we will see a stronger dollar, and not as weak as under Bush or McCain.
"So that is relatively good news for exporters of products to US market, because it means US can buy more Singapore and Asian products. But it's not good news in terms of investment into US."
Among Obama's plans, the one seen to have the largest impact on Asia is his move to stimulate US consumer demand, which makes up about two-thirds of the country's gross domestic product. US is one of the world's largest importer of goods.
Perera said: "The one with the largest impact on Asia will be (Obama's) attempts to stimulate the economy. Generally under Democratic presidents, in particular Obama, there will be efforts to increase government spending to stimulate certain sectors or reflate the economy."
But there has been concern over Obama's bias towards protectionism. Some analysts, however, said these may have been overblown, especially since trade policies are driven more by Capitol Hill, rather than the White House.
Still, they noted that the passage of trade agreements with Asia is likely to slow in the near term. They also added that the US economy will need time to recover.
Perera said: "I think we should start to see impact on financial sector in US maybe towards end of first quarter of next year. In terms of the overall health of the US economy, I think it's going to get worse before it gets better, in terms of consumer spending.
"As for demand for Asian exports, I think recovery will take a lot longer to materialise - not due to Obama but due to structural nature of downturn the US is in." - CNA /ls
Click here for the full text of president-elect Obama's speech.
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