The Organization for Economic Co-operation and Development (OECD), representing the 30 richest nations, released their leading indicator index today, and it's good news for economic prospects in Europe and Japan.

The leading indicator index is one of the best indicators of medium term international economic prospects and rose for the sixth month in a row for Japan and Europe, but dipped slightly for ths US.

The index for the fifteen European Union states increased to 113.8 from 113.1, and for Japan to 107.8 from 106.9.

On the other hand the OECD expressed concern that globalization and economic recovery is still affected by the fallout for the 9/11 attacks on the United States.

Other indicators have shown world trade decreasing. Additionaly to the US, many countries are tightening immigration procedures, and diverting funds to security and defense. Tensions in the Middle East and South Asia are threatening international relations while increasing political risk in Pakistan and India, the former a key strategic hub in the 'war against terror' and the latter the second largest country in a world with an expatriate population spread worldwide.

While the better portents for Japan, the world's second largest economy and the economic powerhouse of Asia, will be well received by other Asian economies, the slower than expected US economy and the links with South Asia and India in particular are of major concern.

Asian second tier economies - the Philippines and Indonesia have recorded the fastest growth of any other Asian economies in the last 6 months, and others like Malaysia and Thailand are looking good from a more advantageous starting point, seeking to emulate the well established South Korean economy.