Asian financial industry should support real economy

Financial markets should play a supporting role to real economy in Asian countries, Zhu Min, deputy managing director of the International Monetary Fund said here Tuesday.

Addressing the Asian Financial Forum in Hong Kong, he said Asia 's financial sectors based mainly on banking and equity market are becoming more and more volatile in recent year. To tackle the risks, Asian countries should make financial sectors serve real economy, including the manufacturing, service industry, agricultural sectors, and aged society.

Along with the economic growth, Asia's growth model should change from export growth to domestic consumption growth, and financial sector should provide vital support since people need financial service to manage their assets in order to consume more, he said.

Zhu said that the financial industry of the Asian countries should be rebalanced. Take China for example. its banking market accounts for 70 percent of financial sector, while the proportion of bonds market is "extremely small," a mere 17 percent.

"If you look at the whole world as a norm, equity market (is) 18 percent, and bonds market roughly 40 percent, and banking is 43 percent."

Zhu said that developing countries will continue to boost Asia' s economic growth, and he expected a 6.1 percent GDP growth of emerging Asia in 2013. Emerging Asia refers to Asian countries except Japan, Australia and New Zealand.

"For emerging Asia, we forecast a roughly 6.1 percent GDP growth rate for this year, and we see even stronger growth for next year around 6.8 per cent", said Zhu.

Themed "Asia: Shaping the Next Global Landscape," the Sixth Asian Financial Forum (AFF) was held in Hong Kong on Jan. 14 and 15. More than 90 global finance ministers and business and financial leaders will discuss Asia's expanding role in the global economy at the two-day event.