First, it depends heavily on rapid growth in foreign demand.

The impact on growth will almost certainly be negative, even if domestic demand compensates fully for the decline in external demand.

The price will fall if the increase resulted from growth in supply, and it will rise if the increase resulted from growth in demand.

But slower growth in China can continue to sustain development only if the economy s structure shifts from external toward internal demand, from manufacturing toward services, and from resource intensive to resource light growth.

It also means getting the balance between domestic and external demand right, and appreciating the sensitivity of medium and long term growth to the composition (and size) of domestic aggregate demand.

Over the next decade, growth in this kind of developing country demand will help offset the slow growth of demand in industrial countries.

It moves economic growth away from a dangerous over reliance on external demand, while shifting support to untapped internal demand.

The opportunities for growth in Europe and the US from this additional global demand are enormous.

Thus, India s high growth rates will have to remain dependent on strong domestic demand.

As more poor countries join the club of emerging economies, and many subsidized renewable energy projects fail in the developed and emerging economies, demand for oil will continue to grow.

But demand management is only part of the job when it comes to fostering long term economic growth.

Oil exporters and China have been accounting for two thirds of global oil demand growth in recent years.

One downside to China s rapid growth is its rising demand for energy and the increased CO2 emissions that accompany it.

Wage growth, rather than borrowing and financial booms, fuelled demand growth.

Unfettered growth in energy demand will clearly have serious consequences for the climate as well.

A return to high growth rates globally will require a broader revival of demand.

Finally, as is true in many of the advanced countries, weak demand constrains Italy s short and medium term growth.

Indeed, China s dilemma is emblematic of one of developing Asia s greatest challenges the need to tilt the growth model away from external toward internal demand.

As food supply growth slowed, demand continued to grow, and not only due to population increase.

China s economy is prone to rapid growth, with buoyant investment demand sustaining powerful short term inflationary pressures.

In principle, foreign demand, especially in high growth emerging markets, could make up some of the difference.

In rapidly developing nations, demand for energy intense foods, like meat, is growing, increasing the total amount of fossil fuels used.

As a result, in US dollar terms, import demand grew by 38.7 , outpacing export growth of 31 .

The Government of Pakistan has launched a 25 year energy security plan to respond to that high growth rate and to meet the rising demand for energy.

Demand is therefore being drained out of the eurozone economies, with stronger external demand, stemming from the euro s depreciation against other major currencies, unable to offset the effect on growth.

Indeed, growth in earnings and profits is now running out of steam, as the effect of weak demand on top line revenues takes a toll on bottom line margins and profitability.

Its future growth will have to be based more on domestic demand than on exports, which will require increases in consumption.

By the end of the year, however, the costs of the structural adjustment needed to shift China s growth model away from investment demand could rise further.

With domestic demand in short supply, this slow road essentially postpones or impedes growth via expansion of the tradable sector.

The right target for generating growth is domestic aggregate demand based on the right mix of consumption and high return investment.

As long as China s commodity demand grows at a higher rate than global supply, prices will rise.

Domestic demand is playing an ever more important role in underpinning growth as interest rates drop and the availability of credit cards and mortgages increases.

Economic growth is expected to moderate in 2005 in all three countries if the external environment weakens and uncertainty remains about the sustainability of domestic demand.

Against this background, South Korea s new growth strategy should aim to achieve both a demand side rebalancing and supply side productivity increases.

The hard part of fully realizing potential growth is shifting the composition of domestic demand from consumption to investment without adding leverage.

Indeed, strong Chinese demand has supported its trading partners export led growth for much of the past three decades.

Governments role will be different in countries like China, where officials will guide a shift from dependence on external sources of growth to more balanced demand.

But the opposite of the excessive consumption model excessive reliance on investment to generate aggregate demand is also a self limiting growth pattern.

The prices of such products had been recovering, largely as a result of Chinese demand, which generally speaking contributed to the accelerated economic growth of the developing world.

With the world demand for oil surging, particularly from China and India, oil prices rose and economic growth continued in 2004 in the Economic and Social Commission for Western Asia (ESCWA) region (except for conflict zones) for the second consecutive year.

Half of India s growth has come from private consumption, and less than 10 from external demand by contrast, 65 of China s real GDP growth comes from exports, and only 25 from private consumption.

When production exceeds domestic demand, producers are compelled to expand exports, creating an export oriented, capital intensive industrial structure that supports rapid economic growth.

But, with the developing world accounting for the largest new markets and most of the growth in global demand, the logic driving atomization should become even more compelling.

There is medium certainty that population growth and increase in food demand will drive an expansion of cultivated land, often at the expense of woodlands and rangelands.

However, as we saw in 2004 and 2005, exports are not enough to create substantial growth if domestic demand does not follow.