Coming to terms with Asia

Abstract

No matter how one looks at the numbers, the Asian economies are bound to have a central role in the global economy this century. This fact has many implications. First, it suggests where the opportunities for growth are going to be over the coming decades. Already the Asian economies account for almost 40 per cent of global output. The Asian century is here. Within Asia there are already half a billion consumers who, by OECD reckoning, are among the world’s middle classes, compared with a billion in Europe and North America. On conservative estimates of relative income and population growth, the middle classes in Asia will grow to 3.2 billion by 2030 but remain a bit under a billion in Europe and North America. Second, the remarkable change in the structure of the world economy, which has seen economic weight realign roughly with population weight after 200 years of being out of sync, is being accompanied by Asia’s growing political influence. The rise of China, and also India, challenge the role of the established European and North American industrial powers in a number of ways. Already managing economic crises has required incorporation of the emerging powers into global economic governance, notably through the establishment of the G20 heads of government summit after the global financial crisis of 2008. The post-war Bretton Woods international system is under review. International financial and currency arrangements are changing in ways that are difficult to predict. The post-Cold War political and security architecture is under scrutiny, with the rise of China and the new powers. Asia’s rise is also influencing the centre of cultural gravity. Countries not only within the region but around the world are adjusting in various ways and with varying degrees of purpose to these realities. In this issue of EAFQ leading analysts from throughout Asia, from America and from Europe address these developments. Some things are clear, though they may have been thus far underrecognised. China, India and the other Asian powers will have a greater role in global affairs. But there is much that is yet to be determined, and it is clear that this theme is one to which we will return. Show more