KUALA LUMPUR: Allianz SE, the parent company of Allianz Malaysia Bhd, sees emerging Asia as the world's growth driver next year, contributing almost 39% to the expected increase in global output.

In a statement yesterday, it said the economic upswing in the Asian emerging markets was expected to continue next year, supported by an ongoing fiscal and monetary stimulus, coupled with "clear recovery" in world trade.

Emerging Asia's economies would likely grow by 6.7% next year, with gross domestic product (GDP) in China and India reaching 8.7% and 6.5%, respectively, it said.

The insurer also expected "much better" prospects for the Malaysian economy next year, registering a growth of 4%, compared to a contraction of 2.5% this year.

"This means that Asia will contribute almost 39% to the expected increase in global economic output of 2.8% next year," the German insurer's chief economist Michael Heise said.

He said the region's GDP would probably grow 4.8% this year, mainly driven by the performance of China and India. "This is quite impressive, given that at the same time, global economic output will contract by more than 2%," he said.

Allianz also said while emerging Asia had been affected by the severe global downturn, it managed to avoid an outright economic contraction, weathering the environment better than other regions in the world.

It added, however, the region would need to focus on domestic demand, particularly on private consumption, should it hope to continue its buoyant growth.

It said while growth here in recent years had been driven by booming exports, world trade was likely to moderate after the crisis, as the US would probably not re-emerge as a source of demand and export growth, which in turn implied substantial changes for the Asian growth model.

"To put it plainly, in the future, the US is unlikely to reprise its roles as ‘consumer of last resort' in a similar way. Nevertheless, emerging Asia will continue to be the most dynamic growth region in the world," Heise added.

The region's share of global value added would also continue to increase, Allianz said. While regional growth in 2006 and 2007 had reached 9%, mainly driven by China's 11% annual growth, such rates were no longer feasible.

Heise added, however, growth rates of between 7% and 8% in emerging Asia were "well within reach".

On another note, the insurer said it was confident of its Asian business, and expected to continue delivering profitability and sustainable growth in the region.

Allianz Asia-Pacific chief executive officer Bruce Bowers said: "Asia's growth markets have shown resilience during the crisis, and our insurance business has been displaying solid results in 2009 so far."

He said the insurer had taken significant steps to strengthen its operating platform across Asia in the last two years, adding next year, its focus would be on maintaining customer service quality and the further implementation of its target operating model.

Allianz Malaysia CEO Alexander Ankel said although 2009 was a "complex" year with the Malaysian economy shrinking, its operations here had fared well, with its gross written premiums rising 21% year-on-year as at end-September.

Ankel said it would continue to focus on its One Allianz initiative next year, which aimed to create a common sales and service platform for its life and general business.

"This initiative will also increase the company's service capability, whereby synergised branches become integrated servicing centres," he said.