Experts warn of downside risks due to North Korea’s nuclear actions

Monday, 25 September 2017 00:00 - - {{hitsCtrl.values.hits}}

Says escalating political uncertainties affect investment decisions in Asia Pacific
ADB Director urges international community to resolve issue peacefully to mitigate anxiety of economic development in region and world

By Charumini de Silva

Experts in the Asia Pacific region raised red flags over North Korea’s nuclear experiments, insisting they were posing significant downside risks to economies in the region.

International Economics and Finance Institute of China Director General Qiangwu Zhou said that the nuclear activities by North Korea are severely escalating political uncertainties, while affecting investment decisions in regional countries.

“There is a ‘filthier risk’ of North Korea’s nuclear experiments. This is definitely going to pose some significant downside risks on the outlook across the region and especially to East Asian countries,” she said at the recently concluded annual Asian Development Bank (ADB) - Asian Think Tank Development Forum 2017 in Colombo.

As North Korea and the US are engaged in a war of words over the recent past, Zhou warned of risks to bi-lateral trade between China and the US.

“War threats are escalating the trade outlook between China and the US with implications for most economies in Asia linked to Chinese economy production and intermediate goods. This is going to be another downside risk, especially to East Asian and South East Asian economies,” she pointed out.

Asian Development Bank (ADB) Director Cyn-Young Park, acknowledging himself as a non-politician, noted that the North Korea nuclear issue is a threat not only to the region, but to the whole world.

He said if the issue is not carefully solved, it may increase anxiety over the economic development in the region and possibly the world over.

“We need to resolve this issue in a peaceful way with the relevant parties between all international communities, so it is not only beneficial for South Korea, but also to China, Asia and to the entire world,” he stressed.