The world economy is in the midst of a fundamental change. The balance of economic and financial power is shifting, from the West to the East. The present doom about the US and worries about the UK need to be set in sharp contrast to the optimism elsewhere.

I was in Hong Kong a week or so ago. It was just like old times. Business is booming. Confidence is high. Taxes are falling. Hong Kong is well placed for China's expansion. Its concern is not slowdown, but that its currency peg to a weakening dollar may attract too much money and prompt a property boom.

It is not just Hong Kong. Three weeks ago, I flew from the gloom of Washington to Brazil. It wasn't just the weather that was good. Economic confidence was high.

A decade ago, Brazil suffered 70% inflation per month. Now, it has 4.5% inflation per year. I was told there it didn't matter for Brazil if the US had a recession, but if China did then that was a problem. Yet another example of how things are changing. Indeed, annual trade between China and Latin America has soared to over $100 billion.

New trade corridors are being seen, with rising flows between Asia and Latin America, Africa and the Middle East. China exports more to Europe than it does to the US. Much of global manufacturing is shifting from the West to the East, but there are also huge flows of investment and people, often in the opposite direction. Tata's recent acquisition of Jaguar is just one example.

The investment from Middle Eastern and Asian sovereign wealth funds into Western financial firms is another.

The world is seeing an industrial revolution. Three quarters of a billion jobs will be created in Asia alone over the next decade. Not just in China and India, but also in booming economies such as Vietnam and Indonesia.

For these the present worry is not recession, but inflation and managing their growth. Rising food and oil prices hit the poor hardest. In the past, these economies were accused of a "beggar my neighbour" policy as they kept their currencies competitive. Now it is a "starve my neighbour" policy as they limit food exports.

In contrast, the worry here is how financial problems play out, with the epicentre of this crisis in the US.

As we have seen in the past few weeks, markets want to respond positively to bad news, hoping that is the end of it. It isn't. This is not the beginning of the end for the US financial crisis. It is the end of the beginning.

The next chapter will see financial problems deepen and lengthen the US recession. There will be a global impact, but given all else that is happening it needs to be kept in perspective.

A US recession will slow world trade, take the heat out of commodity markets and trigger a weaker dollar. Rather than ask whether the rest of the world is decoupled from a US recession, a better way to think about it is are economies elsewhere better insulated now than they were in the past? For many, the answer is yes.

Much will depend on China. The scale and pace of change in China is still not fully appreciated. But even China experiences a business cycle and there will be setbacks.

Yet there is no doubt that its economy is on an upward path. China has spent more money on this summer's Olympics than the five previous hosts put together. Huge sums. But the annual amount spent over a seven-year period represents just 0.2% of the whole country's GDP.

Around the world there is an infrastructure boom. This raises environmental concerns and pushes commodity prices up. Some of this spending will represent excess. In one hotel I stayed at in Abu Dhabi recently it took me 15 minutes to walk to my room. No need to visit the gym there.

But even allowing for buildings that are over the top, most of the new infrastructure is needed. India alone wants to spend $500 billion over the next five years. Anyone who has driven on India's roads or waited in long queues at its airports knows it needs it. But even without this spending, India is already doing well. Imagine what the economy will be like once this spending has taken place. India's catch-up potential is huge.

Despite current pessimism, London and the South-East are in a great position. As emerging economies develop they will need to open up their financial markets and attract international services like banking, law and accountancy. They will also seek creative industries. We have all these in abundance but we cannot be complacent and must position ourselves for the phenomenal global changes that are still unfolding. This is not the time to be pessimistic but to invest and position for a future global boom.

• Dr Gerard Lyons is chief economist at Standard Chartered