Growth in Asia, its roots and implications<\/p>\n
Asia Rising;
\nBy Jim Rohwer;
\nNicholas Brealey Publishing, Great Britain, 1996;
\nPaperback edition, 382 pages;
\nRp 55,000<\/p>\n
JAKARTA (JP): In his lucid and provocative book, Asia Rising,
\nJim Rohwer has attempted to provide insightful arguments on why
\nand how \"the economic rise of East and Southeast Asia in the
\nhalf-century since the end of World War II has been, if perhaps
\nnot precisely miraculous, nonetheless astounding.\" He also tries
\nto answer two major questions: Will Asia continue to grow as fast
\nas it did between 1970 and 1995, and is the rise of Asia good or
\nbad for the West?<\/p>\n
Along the traditional lines of economic analysis, Rohwer
\nargues that Asia has been extraordinarily good at putting
\ntogether the four elements that make for economic growth: A
\nworkforce that grows fast and puts in long hours; improvement in
\nthe quality of workers through education and training; the
\ninjection of large amounts of capital made possible by
\nexceptionally high savings rates; and significant improvements in
\nproductivity because the countries were open to the influence of
\nnew ideas, especially those from abroad through trade, investment
\nand technology.<\/p>\n
The book is made more interesting as it goes beyond the mere
\nconfine of economic analysis. Rohwer argues that the success
\nstories reflect a consistent view of how society and the economy
\nshould be run, insisting that: \"Asia will accelerate the shock
\nwaves that have already begun to destroy the Western world's
\nassumption about public policy and social organization.\"<\/p>\n
According to him the Asian idea of public policy is a hands-
\noff policy, that government should not do much to temper the
\nhazards of life, particularly the often harsh consequences of
\nfast technological and economic change. In this regard, \"the
\nrefusal of Asia's governments to protect people is .... the main
\nexplanation of why Asian economies have grown so fast and why
\nAsian social institutions are still so strong.\" Asia lets its
\nsocieties and economies run away with themselves at first rather
\nthan smothering them under government directions. Asia has done
\nwell because of its system of small (though powerful) government
\nand its strong society.<\/p>\n
On the other hand, while Asia has a good deal to teach the
\nWest about society, it has a lot to learn about the institutions
\nof a modern political and economic system. Its worst weakness is
\n\"its failure to move beyond the informal and the personal in its
\nways of doing business, of governing, and of handling relations
\nbetween states.\"<\/p>\n
Examples of institutional weaknesses \"run the gamut from
\nopacity of company governance to lack of political accountability
\nto paucity of infrastructure.\" In his view: \"the rise of modern
\nAsia has overwhelmingly depended on judgments (business and
\notherwise) based on personal trust and connection\" that give the
\nadvantage of speed and informality in decision-making.<\/p>\n
Looking towards the future, he is of the opinion that Asia's
\ntrajectory over the next 25 years is unlikely to be a smooth
\ncontinuation of the curve it has traced over the past 25. Rohwer
\nis betting that the next phase \"will turn out to have been
\ngreatness.\"<\/p>\n
Though we may argue or even disagree on the details, basically
\nI accept his general thesis. In a nutshell what Rohwer proposes
\nseems to be this: Asia's success stories are not only
\nattributable to favorable economic factors and environments, but,
\nperhaps more importantly, strong leadership (my term) as well as
\nstrong social institutions and values. I use the term
\n\"leadership\" because his terminology (authoritarian government,
\nalbeit qualified as soft or enlightened) may unnecessarily raise
\ncontroversy.<\/p>\n
Besides his insightful and provocative analysis, I think
\nRohwer has made a significant contribution by demonstrating
\neloquently that fabulous economic success in Asia neither poses a
\nthreat nor a cause for alarm to the West in general and the U.S.
\nin particular.<\/p>\n
In a global system of economic interdependence, Asian success
\nand economic well-being in the West is not a zero-sum game. The
\nAsian economic boom creates tidal waves of tremendous new
\nbusinesses and markets and vast opportunities in finance,
\naccounting for about half the worldwide growth in demand for
\nproducts and services. It does, however, alter the basic
\nrelationship but in a positive direction, toward a more
\nsymmetrical and healthier economic interdependence. Hence it is
\nin the interest of the West to maintain a relatively free, fair
\nand open world trading system and not to create barriers and
\nprotective measures to thwart Asian economic success stories.<\/p>\n
Strong leadership has made the success stories possible. On
\nthe other hand, economic success has also strengthened the
\nlegitimacy of strong leadership. Whether the leadership of the
\nfuture will remain strong depends to a large measure on whether
\nor not the economic momentum can be maintained. The challenge of
\nthe leadership of the future is to be able to cope with the
\nattendant problems (including the negatives) of success, and to
\nadjust and restructure in line with the new environment and
\nrequirements. This includes a more open, transparent and
\naccountable system with a respect for the rules of law.<\/p>\n
Continued success will also hinge on a geopolitical structure
\nthat ensures the maintenance of peace and stability in the
\nregion. Regional conflict should be prevented so as not to lead
\nto disastrous consequences. Again this calls for strong
\nleadership.<\/p>\n
-- Sofjan Wanandi<\/p>\n
The writer is chairman of the Gemala Group. The article was
\npresented as a paper in a recent seminar in Jakarta called
\n\"Leadership of the Future\".<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/growth-in-asia-its-roots-and-implications-1447893297",
"image": ""
},
"sponsor": "Okusi Associates",
"sponsor_url": "https:\/\/okusiassociates.com"
}