It’s easy to be bearish on Asia, with trade dependence on the US, disasters, diseases like H1N1, Pakistan 911, etc.

The recent triple whammy of the Lehman Brothers bankruptcy, Merrill Lynch takeover and AIG rescue has also shaken Asian markets briefly.

However, consider Asia’s formidable strengths and attractions.

The 21 member economies of APEC (or Asia Pacific Economic Cooperation) account for more than a third of the world’s population (2.75 billion people) , about 55% of world GDP (US$19,254 billion) and about 49% of world trade.

Asia’s large populations offer a big market size. Much is said about market potential not easily translated to addressable and ‘capturable’ market share high but even after discounting, Asia’s market remains big. The population has a relatively high propensity to save, with premium placed on education, resulting in high savings rate and an increasingly educated labour force.

A huge number of consumers still possess effective buyer power in mega cities, especially PMEBs, retirees and youths.

Asia’s economies still provide a low-cost resource and manufacturing base, enabling sustainable export led growth. This externalization is also helped by the development of small and medium enterprises (SMEs).

In terms of industry structure, there is an abundance of non-equity FDI like original equipment manufacturers (OEM) and global outsourcers and subcontractors.

Asia’s infrastructure development is enjoying a growth phase partly aided by infrastructure financing. This, together with economic and technical cooperation within APEC economies, should facilitate distribution and intra-Asia trade, preparing the region well for the 2015 ASEAN Economic Community.

In soft areas, Asia is benefiting from healthy knowledge transfer and R & D from expatriates and sounder financial management.

Unique to Asia is the Asia cultural factor with premium placed on personal relationship building. Globalizing Chinese and Indian networks across Asia and the world, expansion in new markets like Middle East, Russia and Eastern Europe as well as the preponderance of big Asian MNCs help reduce Asia’s dependency on the US.

Asia is also undergoing gradual regulatory reforms. Countries are continually improving market access and ease of doing business. Sri Lanka’s easier credit, India’s trading procedures made easier, and competitive investment incentives all help to build a more self-sustaining and resilient Asia.

With more European, US and other foreign companies entering Asia or expending their Asia businesses, the outlook for Asia in 2009 remains healthy even if softened by a weaker 1H.