Dr Herbert Stepic, deputy chairman of Austrian commercial and investment bank Raiffeisen Zentral Bank (RZB), said countries with a strong manufacturing base and high domestic demand have a definite advantage over primarily exim-dependent ones in the present economic climate.

Speaking at a Singapore-German Chamber of Industry and Commerce event on Thursday, he highlighted the impact of the financial crisis on the real economy, focusing on emerging markets.

'A mere 20 per cent of China's GDP comes from exports, and even if the number is big, China can stimulate its economy with the huge domestic consumer demand,' he explained, adding that China's recovery will help surrounding economies to recover.

However, he sees emerging economies taking a while to recover from the crisis even as he applauded the quick concerted efforts made by most countries to help their economies.

'This is where the current crisis differs from the Great Depression of 1921", he said.

Banks worldwide must consider focusing on their basic bread-and-butter business if they have to emerge stronger, said Dr Stepic.

'Banks with a broad customer base and direct client access will win because they know their customers and have a clear funding advantage.'

Dr Stepic sees the global economy starting to get back on its feet only by the second half of 2011.

He also advised investors that the current crisis presents a good opportunity for them to put their money into buying firms that are facing liquidity problems. 'But if you are a non-banker, forget about investing in banks,' he quipped.

Speaking of Singapore, he believes that due to the government's quick reaction to the crisis and flexibility of the economy, the country will be less affected. In the long run.

But with funds moving away from the US dollar and Asian currencies gaining strength, he said that 'Singapore will have to soften its currency.'