The World Crisis is bottoming out

Its Davos time again, where world leaders, political as well as powerful industrialists, meet.
Most leaders are cautiously optimistic this time around, compared to pessimism last year. Europe is the worst hit and will take longest to recover. US is limping back slowly. They are all looking at the BRIC nations to lead the world to recovery.

BRIC stands for Brazil, Russia, India & China. I believe that China has managed its economy well and it has turned around. After three straight quarters of falling growth from 8.2% last year to 7.4% in the quarter of June to September, the lowest in a decade, in the last quarter of calendar 2012 (September-December), China reversed the falling trend from 7.4% to 7.8%. Analysts expect January to March 2013 quarter to be around 8.1% - a clear trend reversal.

Now how does this affect other countries? China is a raw material hungry country, and so it owns mining assets in Australia, Indonesia & South Africa. This should help Australia, where mining is the biggest industry.

Also, Chinese need more skilled manpower, so they should be sending more students to Australia, for higher education, which is a preferred destination for them. And education is an important industry in Australia.

Australia is also promoting tourism in a big way. Japanese are the biggest travellers in the world, now being equalled by China and India. As more tourists come to Australia, I see that in the second half of 2013, Australia will benefit both because of Chinese students and tourism. But one has to understand that there is always a time lag between a recovery in China and benefits to Australia, in terms of more spending on consumer goods and more jobs being created. 

So the next 3 to 6 months will be difficult in Australia for job-seekers. Thereafter, things should improve greatly .....