{"id":36733,"date":"2018-01-15T06:00:56","date_gmt":"2018-01-14T19:00:56","guid":{"rendered":"https:\/\/www.aspistrategist.ru\/?p=36733"},"modified":"2018-01-14T13:04:41","modified_gmt":"2018-01-14T02:04:41","slug":"joys-asias-economic-miracle","status":"publish","type":"post","link":"https:\/\/www.aspistrategist.ru\/joys-asias-economic-miracle\/","title":{"rendered":"The joys of Asia\u2019s economic miracle"},"content":{"rendered":"
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For the past 50 years in Asia, the economists have consistently beaten the strategists in the crystal ball stakes. Over those decades, you\u2019d have done better going to an economist rather than a strategist to predict Asia\u2019s future.<\/p>\n

The economist versus strategist proposition upends the clich\u00e9 that economists are the gloomy profession. Compared to the defenceniks, the econ-nerds are radiant optimists, putting their faith in the market\u2019s invisible hand and in all of us as rational actors.<\/p>\n

Strategists dream up the worst possible scenario, then spend billions to defend against it, based on a simple proposition: if only one low-probability, high-impact nightmares arrives, it\u2019ll ruin your whole day\u2014or decade, or country.<\/p>\n

While strategists are happy to have their dark projections proved wrong, economists are never mistaken\u2014they merely rejig the model, refine the theory and demand better statistics.<\/p>\n

Over the past 50 years, the economists have got it right in calling Asia\u2019s miracle, while the strategists have been confounded at how the dream keeps delivering.<\/p>\n

In The Strategist<\/em>, these be fighting words. As this journalist is neither economist nor strategist (and, of course, some of my best friends are \u2026 etc.), I\u2019ll go quickly to the standard hack defence: consider the facts.<\/p>\n

When it comes to facts, my thoughts on Asia\u2019s amazing run are shaped by an economist who has been a trusted guide for decades, Dr Peter McCawley. He has just published a history of 50 years of the Asian Development Bank (ADB), Banking on the future of Asia and the Pacific<\/em><\/a> (download here<\/a>).<\/p>\n

When I sat down with Peter to get my signed copy, the conversation turned to one of his recurring optimistic themes: Asia\u2019s economic rocket is still in the early boost stage, with many more golden decades to go. As McCawley commented: \u2018It\u2019s a dazzling story. We\u2019re just at the start. Asia\u2019s economic miracle can run for another 50 years.\u2019<\/p>\n

\u00a0<\/strong>McCawley points to electricity consumption as just one measure of the distance Asia still has to go. In Australia, annual electricity consumption is around 10,000 kWh per person, and in the US it\u2019s 13,000 kWh per person. In India, Indonesia and the Philippines, the figure is about 800 kWh per person.<\/p>\n

Asia is still relatively underdeveloped, McCawley says, and there\u2019s a lot of upside to come: \u2018They\u2019ve tasted prosperity, and they like it\u2014cars, bigger houses, mobile phones, international travel. The Asian boom will bring lots of troubles, it\u2019s true\u2014more pollution, for example\u2014but the boom will go on nevertheless.\u00a0Asians are sick of being poor.\u2019<\/p>\n

In the book\u2019s conclusion, McCawley cites ADB thinking<\/a> on what the Asian century could look like by 2050:<\/p>\n

If growth in Asia follows recent trajectories, average per capita income could rise sixfold (in purchasing power parity terms) by 2050. In this scenario, the Asian share of global gross domestic product will rise rapidly, from around 28% in 2010 to over 50% in 2050. It is a reasonable assumption that, with half of the world population in Asia, the region will regain the dominant economic position it held before the Industrial Revolution.<\/p><\/blockquote>\n

The description of the golden future is followed by a quick nod to the strategists\u2019 nightmare: \u2018Asia\u2019s rise is not preordained.\u2019 Along with the usual econ-nerd prescriptions about macroeconomic management, infrastructure, health and education, plus open trade and investment regimes, there\u2019s a don\u2019t-stuff-it-up<\/em> injunction: \u2018Hard-won gains in growth and poverty reduction can be quickly lost if there is instability or conflict.\u2019<\/p>\n

Asia is already into a huge investment boom. McCawley comments that Asia\u2019s levels of capital accumulation are low; the capital-per-person figure is only 10% of that in the US. The emerging power in rounding up multilateral capital is China.<\/p>\n

In 2015, China created two new institutions for financing infrastructure:<\/p>\n