The rising cost of college in America coupled with massive job cuts and an economy in recession means that it is becoming more difficult for American students to afford college tuition fees.  Meanwhile across the globe, the situation being not so dire, Asian students continue to apply to top American universities often paying high fees.

The New York Times quoted an annual report published by the National Center for Public Policy and Higher Education, entitled Measuring Up saying that published college tuition and fees increased 439 percent from 1982 to 2007, adjusted for inflation, while median family income rose 147 percent. Student borrowing has more than doubled in the last decade, and students from lower-income families, on average, get smaller grants from the colleges they attend than students from more affluent families.

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Last October, 2point6billion.com, reported on emerging Asian markets constantly climbing new heights - the Sensex, a benchmark index for the Bombay Stock exchange had gained by two percent to 18,658.25 after hitting a lifetime high of 18,703.67 during trade and traders were positive the market would rise well above 20,000.  Across the Himalaya’s in China the optimistic sentiment buoyed by banking and steel stocks continued. The Shanghai Composite Index gained 23.13 point to 5,715.89 on the 9th of October and the next day it gained 55.57 points, or 1 percent, to 5,771.46.

That was then.

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Even as news of Japan’s trade deficit due to falling Asian exports trickled in and Asian companies slashed jobs across the board, APEC leaders decided the financial crisis would end by 2010, within 18 months.  Prudent or not,  the leaders decided to strike an optimistic note “We are convinced that we can overcome this crisis in a period of 18 months,”a joint statement said.

Hedging himself on emerging Asia, Bob Buckle, chairman of the APEC Economic Committee told the AFP “If China and India come through this crisis with very good growth rates that would be very important for the rise of global economy.”

The IMF added that emerging economies, which include China and India — will account for approximately 2.2 percent of global growth next year. According to the AFP, it estimates rich nations’ economies will together grow by just 0.1 percent this year while the developing world will grow by 5 percent.

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While large emerging Asian countries jostled for greater say at the G20 summit last weekend, Prime ministers from Thailand, Cambodia, Laos, Myanmar and Vietnam, met to discuss food and energy security and strengthening transport, trade and investment ties amongst themselves. The group, named after the region’s three major rivers met in Vietnam and forms the Ayeyawady-Chao Phraya-Mekong Economic Cooperation Strategy (ACMECS) forum. Smaller Asian nations have realized that their growth lies in regional cooperation, a reason why Laos, Cambodia, Vietnam and Myanmar are trying to attract investments from neighboring countries Thailand, China and India.

In strengthening regional ties, Cambodia and Vietnam recently agreed to connect Phnom Penh to Vietnam by rail at a cost of more than US$500 million. “China has promised to build the railroad from Phnom Penh to Vietnam as part of the project to create a link from Singapore to Kunming in China,” Hor Namhong told the AFP on his return from regional meetings in Hanoi, Vietnam. Thailand on its part is also investing in rail, road links and bridges to Laos a landlocked country. The group also talked of industrial and energy cooperation particularly hydro-power and oil and gas exploration. (more…)

If China lifts the proposed steel export tax of 5 percent from December 1, the move could severely affect the steel industry in emerging Asia, especially India, warn industry insiders.

China, which is the world’s largest steel market, is mooting to drop steel export prices in a bid to boost the local steel industry which has been severely hit by the global slowdown. India, which imports about 1 million tons of steel (of its 3.6 to 4 million tons steel imports) from China alone will be drastically hit. The problem is expected to be accentuated by the already depressed demand and cut in steel production in India. The effect of the cut in China’s export tax is further compounded as India got rid of its steel import duties last April.

Although India has taken measures to protect their domestic steel industry by increasing import taxes and withdrawing export duties on certain iron and steel products, steel makers are still skeptical about cheaper Chinese steel.

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Global issues such as the economic downturn were traditionally dealt with within the G7 or G8, within strong, wealthy countries who had the ability to bail the rest of the world out. Well, in the last few years, the tables have turned and its now stalwart, energy rich emerging countries such as China and India that the world is looking to. In fact, the International Monetary Fund has approached Asian nations Japan and China to contribute substantially to the bailout fund, aimed at helping lesser developed countries out of the financial crisis.

At the recently concluded G20 summit in Washington, the global community made a clear resolve to broad base the decision-making structures of international finance to include major emerging markets like India and China. A clear signal that emerging Asia has arrived on the global political and economic stage. (more…)

Just days prior to the G20 summit this weekend, top executives at some of the world’s largest private equity firms that met in Hong Kong, Asia’s commercial capital agreed that Asia has surpassed the U.S. to become the world’s most attractive place for investment.

TPG Capital’s David Bonderman and Carlyle Group’s co-founder David Rubenstein, both told Reuters that while getting hit by the financial crisis, Asia was well suited to withstand it, thanks in part to banks’ relative lack of exposure to risky sub prime mortgage securities which sparked the global financial crisis.

Edgerley, Bain’s Managing Director was optimistic too, saying the region was in a better position to weather the financial storm, based on the growth of its consumer market and burgeoning middle class. Bain’s Asia focus is on China, Japan and India he told Reuters.

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Even though Asia hasn’t been affected by the financial crisis as much as the United States or Europe, foreign investors are still shy to bank their money in the region. A recent Reuters analysis on central bank data pointed out that foreign exchange reserves in Asia (excluding China) plummeted by US$119 billion in October to US$2.34 trillion.

India led the fall, dropping forex reserves by US$38.9 billion, while South Korea marked a drop of US$27.4 billion. Singapore, Malaysia, Indonesia and Pakistan were other countries in the region which reported a decrease in their forex holdings as compared to the same time last year. China, holder of the world’s largest reserves, releases data at the end of every quarter.

Foreign investors have sold US$63 billion worth of shares in Asia ex-Japan so far this year, led by the sale of US$33 billion in South Korea, nearly US$14 billion in Taiwan and almost US$12 billion in India, Reuters quoted Nomura.

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Bilateral trade may dispense with the U.S. dollar and revert to RMB and rubles

Prime Minister Wen Jiabao of China is in Moscow holding talks with his counterpart Vladimir Putin over plans to grant an immediate loan to Russian oil companies in return for guaranteed exports to China for the next twenty years. The amounts are expected to be in the region of an immediate US$20-30 billion loan, with supplies worth two billion barrels a year going to China for the next two decades.

Russia and China have already expressed a desire to greater integrate their two economies, and the proposed deal comes at a time when Russia’s relationships with the EU are strained. It also indicates another signal that global power is shifting in deal making processes away from the United States and towards the cash rich economies of China and Japan, both of whom, unlike America, posses enormous cash reserves. (more…)

There’s a very good summary by Kishore Mahbubani, dean of the National University of Singapore in the Financial Times explaining why Asia has managed to apparently keep its head well above the flood gates of the global credit crisis. Complaining with some justification that the Western media has not commented very much at all on the reasons for Asia escaping the worst of the West’s excesses, he reminds us that U.S. and European policymakers are now doing exactly the opposite of what they told Asia to do during the parallel Asian Financial Crisis a decade ago: do not rescue ailing banks, raise interest rates, balance the budget, and avoid government interference.

Asia is indeed ten years to the wise in terms of what Western nations are now facing – the Chinese government itself had to deal with the newly acquired Hong Kong going into financial meltdown soon after the handover. It’s a sense of déjà vu for much of Asia. For more on the similarities, please see this 2point6billion.com article from earlier in October. (more…)