/ 11 May 2009

Soros: Worst of economic crisis behind us

The global economy has already passed the worst of the economic crisis and should soon pull out of its slump, led by Asia and China in particular, Hungarian-born US billionaire George Soros said on Monday.

And as China gradually edges out the US as the world’s economic superpower, it will begin to replace America on the political stage as well, said the man who has made billions speculating on currencies.

”The economic free fall has been stopped, the collapse of the financial system has been averted,” Soros was quoted as saying in an interview with German daily Frankfurter Allgemeine Zeitung.

He said the recovery would make up for ”around half of the downturn we have had” and then the global economy would stagnate for a while.

”Asia will be the first to come out of this crisis but America is close behind. Nevertheless, China will replace the US as the motor of the world economy,” he said.

”The American economy is still bigger than the Chinese. However, China will begin to contribute more and more to global economic growth. Therefore, political power will shift from America to China,” Soros predicted.

Turning to Europe, Soros said the 16-country euro area would survive the economic crisis despite what he said were structural weakness.

”It has been shown in this crisis that having the euro is a large advantage for the weaker countries.” However, he called on Germany as Europe’s biggest economy to do more to pull the region out of the downturn.

Chancellor Angela Merkel’s government has already ploughed more than €80-billion into the economy in a bid to kick-start it but has been criticised at home and abroad for doing too little too late. — Sapa-AFP