The global downturn could lead to unrest, more poverty and environmental challenges in Asia, regional leaders were warned on Monday, after they agreed on a $120 billion emergency fund to counter the crisis, Reuters reported. Asia has been hard hit by the collapse in global demand largely because of the region's heavy reliance on exports. Singapore, Hong Kong, Taiwan and Japan are in recession and growth elsewhere is the weakest in years. "Poverty is worsening in many countries. Businesses are struggling.

The crash of Seoul’s Kumkang Valve Mfg. Ltd. came not because orders dried up but after the fallout from currency contracts that Chief Executive Officer Choi Kyung Shik signed with banks and now says he didn’t understand, Bloomberg reported. In September, Kumkang filed for bankruptcy because of changing exchange rates and terms of the deals. In November, one bank closed the last of Choi’s contracts, costing him $15 million, half of his annual revenue last year. Choi’s firm joined more than 50,000 businesses around the globe that are in a similar predicament.

According to a recent study conducted by Asian Banker Research, Malaysia is listed fourth in the Asia Pacific region's most creditor-friendly bankruptcy regimes where creditors can expect to recover more than 80 cents in the dollar of assets they are owed, the Malaysian national news agency reported. The findings of the study released today said Singapore and Japan were Asia Pacific region's most creditor-friendly bankruptcy regimes where creditors could expect to recover more than 90 cents in the dollar. Taiwan came third with a similar rate of recovery with Malaysia.

Corporate earnings will continue to slump into the first half of 2009 amid the first simultaneous recessions in the U.S., Japan and Europe since World War II, Bloomberg reported on analyst estimates. While profits will rise 4.3 percent for the full year in the U.S., earnings in Europe are projected to decline for all of 2009 and analysts predict worsening reports out of Asia because the recession hasn’t fully hit there yet. Earnings at European oil companies may drop 21 percent in 2009, compared with a 4.7 percent gain last year, according to estimates.

The Taiwan government said Monday it plans to provide 200 billion New Taiwan dollars (US$6.1 billion) in financial aid for struggling large companies, with memory-chip maker Nanya Technology Corp. aiming to submit a proposal to the government for assistance as soon as this week, The Wall Street Journal reported. Taiwan's export-dependent economy is feeling the sharp slowdown in global trade, and the island's producers of dynamic random access memory chips are facing the sector's worst downturn ever.