BANGKOK, Aug 18 (Bernama) -- The United Nations Conference on Trade and Development (Unctad) says the global economy situation will likely to depend more on Asia and the Asean Economic Community (AEC), Thai News Agency reported.

Unctad secretary-general Supachai Panitchpakdi said that the European debt crisis would limit world economic growth at two per cent this year, a prediction different from the US-based International Monetary Fund (IMF) which said world economy should grow by four per cent.

The eurozone could collapse unless the Greece's debt problem was resolved, Supachai said, and forecast that eurozone economy would contract by 0.7 per cent this year and between 1-1.3 per cent next year.

Supachai made the comments during a session themed "New Challenges for Thailand in the New Era of Global Trade and Investment" organised by the University of the Thai Chamber of Commerce here Friday.

According to him, the United States has cut taxes for the rich and has emphasised on financial policies rather than production, resulting in the US economy becoming highly vulnerable.

Supachai, a former deputy prime minister and commerce minister, said he believes the world economy would depend on savings in Asia where high savings accounted for 60 per cent of global savings, with substantial portions coming from China and Japan.

On the formation of the Asean Economic Community (AEC) by 2015, Supachai said he was not concerned over tax reductions once the community is formed.

"Regulations in the 10-nation block should be adjusted accordingly as the world economy will be pinning its hope on the AEC," he said.