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While developed economies, such as those of the United States, Western Europe and Japan, are expected to grow at an average rate of about 1-4% per year through 2004, an annual growth rate of up to 7% is expected over the same period in some Asian countries, such as China, Malaysia, Indonesia and Thailand. The Republic of Korea and Taiwan will continue economic growth of 6% per year, and the Philippine economy is expected to grow at 4% per year.
The economic health of industries in Asia varies by country and changes over time. For example, the textile industry in Japan was thriving in the 1970s when Japan was exporting a large volume of finished textile goods to the United States and Western Europe. However, in the 1980s, the Republic of Korea, Taiwan, Hong Kong and China captured Japan's position. Because of the rapid rise in wages in the Republic of Korea and Taiwan in the 1990s, the textile industries of these countries lost ground to those of Thailand, Indonesia, China, and perhaps India and Pakistan. Although the economies of the Republic of Korea and Taiwan are well-developed in some areas, such as the petrochemical industry (especially ethylene capacity), chemical products that are mainly for domestic consumption (for example, printing ink and paint) will experience a higher future growth rate than the more developed industries.
The automotive vehicle industry is quite capital intensive, and economies of scale are therefore important to success. Except for Japanese producers and one or two producers in the Republic of Korea, Asian auto makers cannot at present export automobiles to the U.S. market at competitive prices. Their production is for domestic markets only and is protected by very high import duties.
The paint industry is growing very rapidly in China, the ASEAN countries, the Republic of Korea and Taiwan. Therefore, markets for chemicals related to surface coatings are also growing rapidly.
The future growth of the pulp and paper industry in Asia will depend on both domestic demand and the availability of wood. The paper and printing ink industries are mature in Japan but are still growing in China, Indonesia, the Republic of Korea, Taiwan and Thailand.
Household detergents are produced and consumed domestically in all of these countries. The per capita consumption of these products varies from country to country, but not as widely as the per capita gross domestic product (GDP). Polyurethane foams are used in large quantities for residential housing insulation and furniture and bedding in Asia. A large amount of polyurethane is also used for artificial leather. The demand for urethane chemicals in Asia is growing very rapidly, and both local production and imports will increase rapidly. PVC plasticizers are produced and consumed in all of these countries.
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