With all due to apologies to the late economic historian Angus Maddison (requiescat in pace), will half of world GDP be accounted for by Asia in 2050? It may seem a far-fetched notion now, but the Asian Development Bank has a new report out which suggests it's within the bounds of plausibility.
The key to achieving this feat says the ADB is for populous and fast-growing China, India, Indonesia, and Vietnam (two SE Asian countries, yay!) not to fall into a middle-income trap. That is, not succumbing to slowing growth rates and concomitantly stagnating income levels in the next five to ten years. If this trap is avoided, Asian GDP may approach $148 trillion and account for 51% of global output by 2050. But, if the region falls into this trap, it will "only" account for 32% of global output with a combined GDP of $61 trillion. It almost makes you proud to be an Asian during this exciting time when old Europe and enervated America are busy competing to see who can flush their continents down the toilet of history faster (I got tired of the dustbin of history, so there).
While these eye-catching figures are more conjectural than anything else, the challenges listed of making more optimistic scenarios come true are certainly worth paying attention to as we try and realize the Asian Century. Focuses the mind, eh? What follows are the key snippets from the executive summary, though the rest is well worth reading for all of those interested in geopolitics and IPE:
The key to achieving this feat says the ADB is for populous and fast-growing China, India, Indonesia, and Vietnam (two SE Asian countries, yay!) not to fall into a middle-income trap. That is, not succumbing to slowing growth rates and concomitantly stagnating income levels in the next five to ten years. If this trap is avoided, Asian GDP may approach $148 trillion and account for 51% of global output by 2050. But, if the region falls into this trap, it will "only" account for 32% of global output with a combined GDP of $61 trillion. It almost makes you proud to be an Asian during this exciting time when old Europe and enervated America are busy competing to see who can flush their continents down the toilet of history faster (I got tired of the dustbin of history, so there).While these eye-catching figures are more conjectural than anything else, the challenges listed of making more optimistic scenarios come true are certainly worth paying attention to as we try and realize the Asian Century. Focuses the mind, eh? What follows are the key snippets from the executive summary, though the rest is well worth reading for all of those interested in geopolitics and IPE:
Makings of the Asian Century
The Asian Century scenario essentially extends Asia’s past success into the future, putting it on the cusp of a truly historic transformation. In this scenario, Asia’s GDP (market exchange rates) would increase from $16 trillion in 2010 to $148 trillion in 2050, or half of global GDP, similar to its share of the global population. With a per capita GDP of $38,600 (PPP), Asia in 2050 would have incomes similar to Europe today. It would have no poor countries (with average per capita GDP of less than $1,000), compared with seven today. All this assumes that Asian economies can maintain their momentum for another 40 years and adapt to shifting global economic and technological environment by continually recreating their comparative advantage.
Actions at three levels
But in its march towards the Asian Century, the region must tackle daunting policy, institutional and governance challenges along the way. Given widely varying country conditions, the precise actions and their timing must vary. Still, it is possible to draw the contours of the major changes necessary for the region along three dimensions: (i) national strategic and policy actions; (ii) collective regional actions to bridge the national and global agendas; and (iii) Asia’s interactions with the global community (Figure 1). The ability of the diverse countries in Asia to realize the promise of the Asian Century will be determined by their success, individually and collectively, in addressing these imperatives.
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