(Billions of U.S. Dollars) Total GDP (Billions of U.S. Dollars) 500 1,000 1,500 2,000 2,500 3,000 1970 1980 1990 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 (est.) 2006 2007 China South Korea Taiwan Hong Kong Indonesia Thailand Singapore Malaysia Philippines Note: Japan GDP was 3,053 in 1990 and 4,651 in 2000. Sources: IMF. The World Economic Outlook (WEO) Database September 2006. 2006. Chinese National Bureau of Statistics.

The Double Dip Recession in Asia Real GDP Growth (Annual Percent Change) -15 -10 -5 5 10 15 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 (est.) 2006 (est.) 2007 (est.) China Hong Kong South Korea Singapore Malaysia Taiwan Thailand Philippines Indonesia Japan Source: IMF. The World Economic Outlook (WEO) Database September 2006. 2006.

Is the slowdown of Pac Rim growth temporary or a long-term trend? Key economies undergoing restructuring: - Japan - South Korea - Taiwan - Indonesia

Impact on economic alignments: - Shifting trade linkages: soaring intra-Asian trade - Investment patterns: flows into and out of Asia - R & D / Royalties: growing scientific strength in Asia

Inflows of Foreign Direct Investment (Billions of U.S. Dollars) -10 10 20 30 40 50 60 70 80 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 China Hong Kong Singapore Malaysia Indonesia India Philippines Japan Taiwan Thailand Pakistan South Korea Source: UNCTAD. On-line Handbook of Statistics

Effects on Regional Institutions: - APEC - ASEAN - ASEAN + 3 - Shanghai 6 - Chiang Mai Initiative - East Asian Summit

Effects on Strategic Linkages: Options for guarantor: U.S. / Japan / India China U.S. India