WASHINGTON (AFP) — US legislators approved a massive government lifeline for the ailing auto industry as fresh economic data on Thursday offered evidence of a deep and painful global recession.
The House of Representatives raised hopes on Wednesday by approving a package worth 14 billion dollars to keep the three biggest auto makers afloat -- potentially the most far-reaching intervention in US industry in years.
House Speaker Nancy Pelosi said the legislation helping the Big Three automakers -- Ford, General Motors and Chrysler -- would serve as "a jumpstart for an industry and our country's economic health".
But the legislation now faces stiff opposition in the Senate from Republicans who consider it a quick fix.
Republican Congressman Tom Feeney described the bailout as a "short-term solution" and telling the House: "Micro-managing a business from Washington is the supreme act of hubris. It will never work."
The world economic crisis meanwhile showed signs of deepening, with a flood of woeful data on Thursday painting an increasingly gloomy picture in Asia.
The Asian Development Bank said growth in Asia's developing economies will slow to 5.8 percent in 2009, from a previous estimate of 7.2 percent, and that regional governments must boost domestic demand to counter a deeper slowdown.
"Developing Asia -- which initially looked well positioned to weather the global crisis -- has come under increased pressure," the ADB said in a special report monitoring the crisis, released in Hong Kong on Thursday.
"Weakening demand for manufactured goods in major industrial countries means declining export orders from Asia, with knock-on effects for industrial production," the report said.
In China , the powerhouse of Asian growth, inflation dropped to a 22-month low of 2.4 percent in November from 4.0 percent in October, the government said.
Analysts said the data raised the prospect of deflation -- a decline in prices which can increase unemployment.
The US Treasury has called on China to adopt swift currency reforms, warning that the Asian giant faced greater risks if the current global financial and economic crisis worsened.
In a closely watched semiannual report to the US Congress, the Treasury did not identify Beijing as a currency manipulator but said that the yuan was relatively undervalued against the US dollar.
Falling exports by South Korea , also contributed to a surprise move by the central bank to cut its key interest rate to a record low.
The Bank of Korea lowered its benchmark rate by an unprecedented 100 basis points to three percent, the fourth reduction in just over two months as Asia's fourth-largest economy slows down quicker than expected.
"As exports growth turned negative, the economic slowdown is faster than expected... downside risks are great because of the financial market jitters and global economic slowdown," the central bank said in a statement.
Unemployment in Australia rose to 4.4 percent in November, its highest level in a year, as the global economic slowdown took a growing toll on the nation's once-thriving economy, figures showed Thursday.
The jobless data were released a day after Anglo-Australian mining giant Rio Tinto announced it was cutting 14,000 jobs worldwide -- including 5,500 employee roles and 8,500 contractors.
A survey by the Japanese Trade Union Confederation showed more than a third of the nation's companies have laid off workers or taken other steps to reduce labour costs in the past three months to cope with the global economic crisis.
It forecast more companies will streamline their employment over the next three months, with nearly 40 percent of manufacturers expecting to lay off more temporary workers.
Trouble in the US auto industry is also likely to feed through to Japan's auto makers , who rely on many of the same suppliers linked to the big US car firms.
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