It is easy for the growing number of "China watchers" throughout the world, enthralled by the rapid emergence of a front-ranking economic power setting new development records with each passing year, to overlook the fact that the past half-decade has been an unusual difficult time in which to perform such feats.

The disappearance of Japan, North Asia's locomotive economy, into a seemingly interminable state of stagnation from the beginning of the 1990s was compounded by the virulent "Asian flu" of 1997, which devastated financial markets across the whole western curve of the Pacific Rim. Although the Chinese mainland itself avoided the worst effects of the 1997 financial contagion, its economic partners within the region were thrown into spectacular disarray, along with Hong Kong and Taiwan. The turn of the millennium was thus a period of painful re-adjustment and recovery for the previously unstoppable "tiger" economies.

A further blow fell with the 2001 popping of the US "Cyberspace" bubble, followed by years of economic dislocation and shrunken demand, further hampering the recovery of China's East Asian neighbours. Yet another consequence of the US "dot-crunch" was the disturbing growth of US protectionist sentiment, exacerbated by the heated populist rhetoric characterizing the run-up to the 2004 election.

As if this economic environment was not already sufficient to derail development hopes, China and its neighbours were also stricken by the SARS contagion last year, which caused widespread international anxiety - at times approaching panic - with a consequent fall-off in investment, visitors and consumer spending.

Despite this succession of misfortunes, China posted scorching growth of 9.1 per cent last year. So observers wondering whether Wen Jiabao's surprisingly modest forecast for 2004 GDP growth, at 7 per cent, points to a long-term cooling of China's economic surge should probably think again.

Not only is China's domestic legal and economic policy framework continuing to advance rapidly on its course of reform and opening up, but the dismal global climate of recent years is looking more positive than it has for years. In fact, in certain important respects, the prospects for the world economy have simply never looked better.

China's fellow demographic superpower India also posted superb growth figures last year, at 8.4 per cent, implying that the fruits of economic liberalization are beginning to ripen in South Asia too. The potential for mutually beneficial Sino-Indian economic ties are truly enormous, sufficing on their own to place 40 per cent of the human race on the fast-track to prosperity.

Japan also seems to be emerging from its economic stupor, set to provide a major stimulus to the entire region. When US economic recovery is added to the equation - and most economic experts expect it to be powerful and prolonged, promising five years or more of growth in the 4-5 per cent range - the picture for overall global demand becomes remarkably encouraging.

China has proven it can thrive even during difficult times. With the rosy glow of the dawning Asian Century now clearly visible, it would surely take an irrational pessimist to doubt its potential now?

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