Next week, European and Asian heads of state and government gather in Vientiane, Laos, for their biennial Asia-Europe Meeting (ASEM). The meeting takes place against a somber global outlook. The European economy is in poor shape, while Asian economies are also slowing down. Add in the troubles of the US economy and it makes a gloomy world picture.

Inevitably, ASEM will be dominated by the global economic situation. Leaders are exhorted to resist protectionism, ensure fiscal prudence and stimulate domestic demand.

European leaders will tell their Asian counterparts that the worst of the eurozone crisis is over. The decision of the European Central Bank to intervene in the sovereign debt crisis has removed fears of an imminent default by any government. There remain huge problems in Greece and Spain but the markets are no longer focusing on a "Grexit".