As industry recovers, rich countries lag-paper

* World industrial production up 40+ pct in past decade

* Developed nations won’t see return to peak until 2013

* Emerging markets already surpassed 2008 peak

NEW YORK, July 9 (BestGrowthStock) – Industrial activity in
developed countries, which fell more steeply during the
recession and has been slower to recover, will not return to
its 2008 peak until 2013, according to a research paper by the
Manufacturers Alliance/MAPI.

The Arlington, Virginia-based business research
organization shows a different picture for industrial activity
in emerging economies, where the recession was shallower and
shorter. Industrial production in emerging Asian economies has
now exceeded its 2008 peak, according to MAPI.

“They did not have the property bubble we had,” said Chief
Economist Daniel Meckstroth, author of the July 6 report. “They
did not have the financial speculation bubble. Advanced
economies, to hype growth, developed a debt-based economy.”

The report highlights the growing importance of economies
like China and India to multinational industrial companies,
which will begin reporting their second-quarter results next
week. Industrial bellwether General Electric Co (GE.N: ) will
issue its earnings report on July 16.

The data are based on the physical volume, rather than the
value, of goods produced. The report shows industrial
production fell 18 percent in advanced economies from the peak
in the first quarter of 2008 to the cyclical trough in second
quarter 2009. The drop was steeper in Japan and the euro area
than in the United States.

But the recovery has been muted. Industrial production from
the trough to this year’s second quarter is up only 9 percent
and will not exceed the prior cyclical peak until the third
quarter of 2013, according to the forecast.

The risk of a double-dip recession in the United States “is
not inconsequential,” Meckstroth said, since job growth has
disappointed and housing remains depressed.

By contrast, industrial activity in emerging economies fell
6 percent from peak to trough and has since rebounded by 20
percent. China and Indonesia kicked off the rebound, soon
joined by other Asian economies, then Eastern Europe, Latin
America, Africa and the Middle East.

That growth in emerging economies was enough to push
overall global manufacturing out of a recovery phase and into
expansion in the quarter just ended, MAPI said.

World industrial production is up more than 40 percent over
the past decade, with nearly all of that growth coming from
emerging economies.
(Reporting by Nick Zieminski; Editing by Lisa Von Ahn)

As industry recovers, rich countries lag-paper