Will We See A New Asian Century In Our Lifetime?

Since the end of the Cold War, many have envisioned a world led by the United States and its Western allies. Instead, Asia has led the way since.

In politics, culture, and the economy, many have said that Asia has taken over the leading role once held by Western powers. Indeed, it is more like Asia is resuming its historical place as leader of the world – where China’s GDP dwarfed that of Western Europe, and other Asian societies “were infinitely more civilised than the barbarians of Europe.”

This new Asian century will by and large be led by regional powers China and India. Emerging economies like Indonesia, Pakistan, Vietnam, and Bangladesh will also experience their own meteoric rise in economic strength and influence. Japan and Korea, while still remaining wealthy, will face the challenges of aging population and a sluggish economy – but may experience a resurgence.

A HISTORICAL PERSPECTIVE

After World War II, East Asia has been the catalyst for most of the continent’s economic growth. First, post-war Japan drove much of the region’s growth from the 1950s to the 1980s. Then, the four Asian Tigers – Taiwan, Hong Kong, South Korea, and Singapore tapped into the burgeoning trend of globalisation. Most recently, China has awoken after slumbering for a century. Each Asian development story follows a similar script: a mostly agrarian society transformed by rapid industrialisation, then a transition from labour-intensive to capital-intensive production, accompanied by a rise in tertiary economic activity (services etc). Growth is driven by factors like higher savings and educational attainment levels coupled with governmental policies that favoured foreign direct investment and export-oriented economies. This has led to a spectacular rise in Asia’s GDP per capita. It has gone up by more than 4,300 percent from 1960 to 2008 and has brought over one billion people out of poverty.