The Key To Asia's Future
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The Key To Asia's Future

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Over the last several decades, Asia has become increasingly integrated with the rest of the world, its rapid development driven largely by exports to the United States and European Union (EU). Yet, as the world’s main economic arteries shift eastward, intra-regional integration within Asia still lags behind. The recent global financial crisis and economic fall-out is quickly changing that dynamic, however. Indeed, as strong, stable economic growth in the West, particularly in the U.S. and EU, remains elusive, regional markets are becoming more attractive among Asian countries, highlighting the importance for enhanced integration. Despite challenges, this trend toward regional integration should continue in 2013.

Currently, over half of world trade takes place between members of regional trade agreements, and Asia is no exception. However, in Asia, as in other parts of the world, regional integration is uneven. While Southeast Asia is shoring up its economic integration efforts through the Association of Southeast Asian Nations  (ASEAN) Economic Community Blueprint for 2015, with plans to continue attracting foreign direct investment, capitalize on the growth of its neighbors (mainly China and India), and accelerate the pace of its trade facilitation measures through a single market strategy, South Asia remains weakly integrated through the South Asian Association for Regional Cooperation (SAARC) both economically and politically.

Regionalism, not Protectionism, Can Help Mitigate Global Uncertainty

In fact, Asia has reason for optimism about the capacity of regional trade to compensate for weak markets in the U.S. and the EU and to reduce vulnerability to external shocks. In 2012, opinion leaders in Southeast Asia said that they were most positive about the ASEAN Economic Community compared to all other regional trade agreements in Asia. Indeed, while East Asian economic cooperation has mostly been driven by market forces, Southeast Asia has taken significant strides in formalizing its region as a single market and production base through ASEAN. Intra-regional trade and trade with China now accounts for more than 37 percent of ASEAN’s total trade, up from around 26 percent in 2000. At the same time, trade with the U.S. has fallen from 20 percent in 2000 to 10 percent in 2011, and trade with the EU from 15 percent to 11 percent in the same period.

On the other hand, progress on SAARC’s goal of a South Asian Economic Union by 2020 remains relatively slow. Though intra-regional trade in South Asia recently surpassed $2 billion following the full implementation of the South Asia Free Trade Agreement, it represents only 5 percent of the region’s total trade volume, compared to ASEAN’s 22 percent and the EU’s 55 percent. However, South Asia has made strides integrating with the rest of Asia. For example, while only 1.3 percent of South Asia’s parts and components are traded within the sub-region, 56.3 percent go to East Asia. This represents the enormous potential that exists for South Asia’s future trade among its own region.

Such economic integration in the region is becoming increasingly important to help stave off and overcome global economic shocks. Prior to the last-minute resolution that saved the U.S. from falling off the “fiscal cliff,” the UN Social Commission on Asia and the Pacific warned that if the U.S. were to fall, it would have dire consequences for Asia, decreasing growth by as much as 2.2 percent in some countries. To reduce their dependency on developed countries’ economies, Asian countries need to diversify their export markets and take advantage of the efficiencies and growing demand that regional trade offers.

Comments
37
Bongskie
February 24, 2013 at 12:31

People like Liang were released perhaps by their government to spew out misinformation or propaganda glorifying their government and country at the expense of other countries. This is exactly the reason why China lacks credibility, nobody trusts them.

Yong Tae-un
January 28, 2013 at 00:12

Liang1a is absolutely correct.  The key to Asia's future and of the world, is China;  Not Asian countries.  Without China, all would not be enjoying the prosperity they are experiencing now, nor of the importance Washington attaches to them now. Any other claims are non sequitur.  But Washington and Obama would deny China the recognition it deserves for helping so many countries and its people moving from starvation, deprivation, joblessness, to economic and educational opportunities.  From Africa to Asia to Latin America, even to Europe and North America. never in the history of the planet has any one country helped so many.  That its people sacrificed living below their means to assist other countries, including some undeserving ones like the US, should be duly and deservedly recognized.  Where is the Nobel Prize Committee and the UN?  Must it continue to bend to a bully like Washington who would persist in ensuring that any act or news that gives China a positive image is duly suppressed or repressed?

January 26, 2013 at 04:17

[...] http://thediplomat.com/2013/01/18/integration-is-key-to-asias-future/ [...]

Jeremy
January 24, 2013 at 00:35

@JC
 
Nice to be able to have a nice chat with you again. Miss me?
 
"Japan and South Korea are Chaebol authoritarian countries, all of them have the formality of democracies, but in essence are ruled by few feudal Chaebols."
 
"I must protest on behalf of the Philippines, Japan, South Korea and the Philippines share the same social, development and values; all of them are USA lackeys, all of them are being occupied by the USA militarily, all of them are mentally colonized by the White, all of them hate their parents who give them Asian features and dark skin, …"
 
I'm not at all knowledgeable in the area of the Philippines so I shall leave that for another, more able writer who is more well-versed in that area to clarify. But, thinking that I have, at the very least, a meagre understanding of Japan and South Korea, I speak on their cases here.
 
Firstly, on account of your somewhat unorthodox grammar, I don't actually know whether you have set up your own argument or are rebuking TV Monitor's. But when I look at the current state of China, which you so vehemently and ardently try to vindicate, I cannot help but think that your argument is pervaded by a sense of hypocrisy.
 
But that aside, being what I hope is but a small mishap on your part, let's talk about your Japan/Korea = authoritarian claim. It is true that Korea and Japan both play host to a number of Keiretsus and Chaebols, but they are NOT "ruled" by them. And given China's current state, I don't really think that, as an upholder of China, you are in the rhetorical, logical nor argumental right to call Japan or Korea "authoritarian" – at least in these countries people can actively and publicly criticise their governments without fear for their physical and mental integrity. If Japan was, indeed, ruled by its commercial sector as you so clearly suggest, would there be a no-go-zone around Fukushima today? Would there have been any inquiries, any public protests against the energy-sector Keiretsus? In the Korean case, if each such "authoritarian" Chaebol had "authoritatively" had its own way, Korea would still be struggling with the aftershocks of the 1997 Crises – it was the Korean GOVERNMENT which pressured the Chaebols into reform to avert the Crisis, NOT the other way around. "Ruled by a few feudal Chaebols"? Please. Go live there for a month and see how things compare with the land of the Zhong Hua.
 
And now, for all this bullcr@p about "mental and military colonalisation." Just because the governments of Korea and Japan have been able to see benefits in some form or another from strong ties with the US does NOT make them its "lackeys" – as an ethnic Korean myself, I find that an extremely offensive and hopelessly delusional comment desperately attempting to portray China in the hero's spotlight. I doubt even the CCP brainwashes their people to this degree – what your rhetoric is getting at is something reminiscent of North Korean propaganda.
Japan and Korea are NOT being mentally colonised – au contraire. If they were, would their pop culture and their dramas, their songs, even their works of literature, in many cases, have a foothold on the world like it does today? Would PSY have become a global sensation if the United States managed to successfully downplay him as "just one of our colonised lackeys?" Would Murakami Haruki be considered amongst the most influential writers of prose alive today and his novels placed amidst the Pantheon of modern world literature if Europe had merely slandered him as a foot-wiper of the likes of Kafka or Orwell? Or would the words K-Pop and J-Pop be more well-known terms in the Western Hemisphere than "C-Pop" if China were the only "mentally" dominant player on the Asian field? And on top of that, do NOT think that the Chinese are the only people in Asia with a strong national identity – Japan, Korea, even those third-world countries in Southeast Asia, even Taiwan, have them, and in many cases they are much stronger than yours, which I've witnessed in many areas attempts to take advantage of the concept of "strength in numbers." We're not mentally weak – we know how to critically analyse the relationships we have with other nations, even with China, even with the U.S., and we have the social and ideological capabilities to express both our utmost opposition or our ardent support when the situation arises – cite the reactions around the outbreak of the Iraq and Afghanistan Wars, the killing of schoolgirls in Korea and the rape of locals in Japan by American stationed personnel.
 
And "all of us hate our parents who gave us Asian features and dark skin"? I have never heard such rubbish on my part before, and I doubt I will anytime soon on these boards and threads (unless you comment further, I predict). As a Korean, I, along with MANY of my Korean friends, are genuinely PROUD of my parents and their generation, and the generation of theirs, who brought my background country from being a country poorer than Ethiopia not more than a half-century ago to the industrialised, democratised haven it is today. I know and acknowledge that Korea and Japan have their own fair share of social and economics problems, but boy, on a day-to-day basis, we sure are better off than you. When I think of 1964, when President Park Chung-hee, flying on a borrowed German plane to the Germany and the Korean miners drafted to work there, it nearly makes me teary. As corrupt and power-hungry a politician as he was, one of many Asia has had to worry about, he still cared for the well-being of his people, discontinuing his speech to the miners due to his own tears when he said, "It has been a hard time on us… but, at least for the sake of the betterment of the lives of our children and theirs…" And that makes me even more heartbroken when I realise that it's my father's generation, my mother's generation, the generation of my aunts and uncles, and the generations of those above them, who had to know the cruelty of war, that put that sweat on their brow to give me, my friends and our country as a whole the opportunities it has today. "Hate our parents"? I don't know whether this is some strong propaganda that your hard-right anti-West ego has fed itself or whether your CCP friends have engrained this in your head, but I have never heard of a statement so ignorant, so idiotically dogmatic, and so unbefitting to someone who claims to uphold and love the nation where Confucius was born. I've been to Japan, too, and stayed with a Japanese family, and they're not ashamed of their parents nor their grandparents who still managed to convert the ashes of war into an albeit stagnating yet still globally significant economy. What they ARE divided on, from what I've seen and heard, are those above them who were related to the Wars.
 
If you continue blabbering on this sort of nonsense, I can assure you I won't be the only one who'll be upset, nor will I be the only one who knows they can so easily counterclaim your statements.

Jean-Paul
January 23, 2013 at 10:02

@ John Chan
 
It looks like I need to give you another lesson on history my poor commie friend. Do you not know the history of the USA and how it was founded? Your ignorance is truly laughable  to suggest that the USA would attack any of its great european allies.
 
The USA has made France as one of its prime allies over the course of history and gives it the master of Africa position. The US Anglo-Saxon elites will never forget the French benevolence during the revolutionary war. They know that without the French they would still be a British colony and never attain the status of superpower. Learn some history before spewing ignorant statements.

Gaddafi bin Laden
January 22, 2013 at 12:50

Seems the moderators have gone to extremes now. They censor any hard hitting and impactful arguments against their trolls who in effect are those *rseholes appointed to write for the Diplomat.  Then they use your argument against you.  freedom of speech?  What BS.  They are no better than the Chinese government they slander.  They practise the same suppression of freedom of speech and opinion, and in all probabilty, in a worse way.  At least Beijing don't go around slandering and defaming others.  Where are the Sunni jihadist terrorists when you need them?  Please send a suicide bomber to their office in Tokyo.

John Chan
January 22, 2013 at 08:48

@Brian from Chicago,
There are some factual errors in your comment,
1. Chinese is the biggest minority in Japan; therefore it is totally false for you to say there is 0% Chinese in Japan.
2. Japanese and Korean cars are also threatening USA car industry, are you saying Japanese and Korean people simply superior to the American and the White by extension? It seems you are applying double speak, double think, Straw man fallacies all at once in the you comment.
3. You are so confused, you mixed names, you mixed up facts, you mixed up logics, you mixed up …, or well you are so screwed up.
 
 
 

John Chan
January 22, 2013 at 08:22

@TV Monitor,
I must protest on behalf of the Philippines, Japan, South Korea and the Philippines share the same social, development and values; all of them are USA lackeys, all of them are being occupied by the USA militarily, all of them are mentally colonized by the White, all of them hate their parents who give them Asian features and dark skin, …
 
It seems you are another Frenchman, arrogant, ignorant and racist, because you have made a blatant  factual error by stating Singapore and Saudi Arabia are alike; you should know the fact that Singapore is a multiparty democracy while Saudi Arabia is a theocratic monarchy.

John Chan
January 22, 2013 at 07:55

@Jean-Paul,
It seems you are a commie, you are not paying proper respect to the leader of the Western world, the USA. USA does not make mistakes, only everybody else makes mistakes in according to the American Exceptionalism.
 
Humiliating the USA as stupid is an unforgivable crime that deserves bombing and killing into total destruction in the name of maintaining world order. The 6th fleet will conduct operation shock and awe on France to teach the French unruly arrogance a lesson.
 

John Chan
January 22, 2013 at 07:43

@Observer,
In 30 years China has replaced Japan as the world 2nd largest economy, by 2025 China will replace USA as the largest economy, by 2050 China’s economy will be 10 times of Japan economy; all these predictions are made by the westerners and Japanese.
 
Are you saying the western and Japanese economic experts are all wrong and not better than you? Or are you simply trolling because you are jealous, resentful and fearful of China’s achievements?

humble
January 22, 2013 at 01:27

what about you, a Chinese 50 center troll disguised in a Thai name?. You chines sound ranting remarks is funny indeed.

Chittrwa Wongpaksern
January 21, 2013 at 22:09

"David Teng" indeed if you are "David Teng" and not a pseudo overseas Chinese.  More likely, you are just the typical propaganda troll ensconced here to villify anything China or Chinese as instructed by the Pentagon and CIA..  Your argument is just what it it, pure BS.  Your rants makes no sense.  As JC said, it is indeed nothing more than misinformation.  I prefer to call it BS.  As I would say the same to that pseudo Frenchie "Jean Paul".

Liang1a
January 21, 2013 at 13:29

What happened to my post in answer to Brian from Chicago?

Liang1a
January 21, 2013 at 05:01

One word of explanation.  I have said in my post that the prosperity of Asia depends on China and provided the correlation between the proportion of ethnic Chinese in several SEA countries and the wealth of these countries.  Obviously, the current prosperity of Singapore and Malaysia depends more on the proportion of the ethnic Chinese in these two countries and have less to do with their relationship with China.  But going into the future, their relationship with China will determine how wealthy they can become.  Malaysia depends to a large extent on export of palm oil to China.  Increasingly also Malaysia will depend on trade of other products with China.  Since all of the Asian countries cannot be self-sufficient in technologies they must import technological products from China.  They must also have investments from China to produce locally high tech products to minimize the cost of these products.  So this proves that the future of Asia depends both on the proportion of ethnic Chinese in their countries and on their relationship with China who will play an increasing role in trade and in investing in these countries.   And it is the ethnic Chinese who settle in SEA countries to generate wealth and reinvest these wealth that ultimately produce the jobs for the local peoples that allow them to have higher purchasing power.  In other words, ethnic Chinese expand the domestic economies of the SEA countries and China will provide more economic opportunities in terms of trade and supplies of high tech products.  In contrast, Japan and the West don't expand the domestic economies of these SEA countries and cannot increase the purchasing power of the SEA peoples.  Japan and the West only want to sell things to the SEA peoples to reduce their wealth.  This is the difference between China and Japan and the West.  China and the ethnic Chinese increase wealth of the SEA countries while japan and the West decrease the wealth of these countries.

Liang1a
January 21, 2013 at 04:34

Jean-Paul wrote:
 
January 19, 2013 at 10:30 am

@ Liangia and John Chan

Please for the sake of peace and prosperity in Asia you need to drop that racist superiority complex that you have, it will do nothing but bring resentment and hatred towards China and continue to accelerate its path towards total containment.

Singapore is only rich because it has received over a century of support from Great Britain and has been a major trade route for the great western nations, Chinese have nothing to do with it. Malaysia and Thailand are both 3rd world countries with massive amounts of poverty and you are claiming they are rich? Is that a joke?

Also comparing GDP to GDP per capita is a fair comparison, in fact GDP per capita is a much better measurement compared to overall GDP. For example China has a larger GDP but most of its citizens cannot afford their own houses and live in total poverty and pollution. Having a large GDP only benefits the 1% of those countries, are you part of the 1% John Chan?
——————————————
Obviously, the Westerners are all hopping upset because a mere Chinese dared to argue that the Chinese can be superior to them.  You Westerners are the racists here.
 
As to Singapore, it has developed due to the intelligence of the ethnic Chinese.  I had never suggested that the CCP government had anything to do with Singapore's prosperity.  Furthermore, Singapore's prosperity has little to do with UK either.  If you want to argue that UK is responsible for Singapore's prosperity then you must provide evidence such as how much UK has invested in Singapore which accounts for what percentage of Singapore's GDP.  My point is that it is the large proportion of ethnic Chinese that has made Singapore prosperous.  It is the wealth of the ethnic Chinese that has provided the trillions of dollars of investment that have produced the hundreds of billions of dollars of GDP of Singapore and its hundreds of billions of dollars of forex reserve.  Therefore, it is an obvious fact that it is the ethnic Chinese who produced the prosperity of Singapore.
 
It is also clear to anyone who knows anything about Malaysia that it is the ethnic Chinese who are generating all the economic activities and producing all the wealth.  It is the ethnic Chinese who are the best educated and who can handle all the modern businesses and industries.  It is the Chinese who are the engineers and the business managers and the lawyers and the doctors and the plantation owners and so on.  The Malays are practically parasites on the Chinese.  There is even a law that says a Chinese law firm must hire a certain proportion of Malay lawyers because Malay lawyers are so incompetent that even Malay clients prefer to hire Chinese lawyers.  Obviously, if the Chinese were gone then Malaysia will collapse into poverty.
 
As to Indonesia, it is also clear to anybody who knows anything about that country that it is the Chinese who produced all the wealth of that country.  After the 1997 massacre the Chinese fled and the Indonesian economy collapsed immediately.  After many years of stagnation the Indonesian government begged the Chinese to return to revive its moribund economy.  Only after some Chinese returned to Indonesia did its economy begin  to revive. 
 
Are the Chinese "superior"?  Maybe.  But the factors that make the Chinese more successful are their respect for scholarship, their willingness to take risks and above all their industriousness.  The Chinese people are frugal and save most of their money for reinvestment capital.  These are the main reasons for the Chinese success.  To the degree that they have allowed the Chinese to be more successful, it is obvious that the Chinese are "culturally" superior.
 
One last comment about Singapore.  It is bigotry to say that UK and geographical location have made Singapore wealthy.  Malaysia is right next to Singapore and had been a British colony like Singapore.  Therefore, there is no difference between Singapore and Malaysia in terms of geographical location and affiliation with UK.  Yet Singapore is many times more prosperous than Malaysia.  Therefore, the difference must be due to the larger proportion of ethnic Chinese and their freedom to do business as indeed it is the ethnic Chinese who produce and own most of the wealth.  And it is also the ethnic Chinese who produce and own most of the wealth in Malaysia.  Nobody with a fair mind will deny that the fact that it is the larger proportion of ethnic Chinese who are responsible for the prosperity of these two countries far above the other countries of SEA.  The other countries with few Chinese or where Chinese are not allowed to work freely are all poverty stricken.

Therefore, in the end, it is the Chinese and only the Chinese who can make Asia prosperous.  Those who are worried that this counterproductive to increasing the friendship with the Westerners should know that there is no way to make friendship with the West on an equal footing.  Therefore, China loses nothing to ruffle the feather of these Western bigots.  By forcing the truth of China's cultural superiority on these bigots at least they will have some grudging respect for China.

TV Monitor
January 21, 2013 at 02:21

@ John Chan.
Singapore, while wealthy, is not a democracy but a authoritarian state like Saudi Arabia. Taiwan does have a real democracy, even if flawed. The other countries that you mention are 3rd world countries.
So you have the grouping of just two; the fully "western" countries like Australia, Japan, Korea who do not consider others as being equal to them as sharing their values, and the rest of 3rd world countries. It is impossible to have a regional cooperation of the equals when these countries are poles apart in terms of social maturity, development, and values.
 

Observer
January 21, 2013 at 01:36

@ liang1a who said this:
 

"The only reason for Vietnam's larger per capita GDP is only due to its incomes from oil and gas which amounts to more than $15 billion in 2011.  Obviously if the oil income is taken away, Vietnamese economy will collapse and become less than that of Laos and Cambodia."

 
Another ignorant statement from you. Do you know how much money Vietnam get from Vietnamese living oversea/abroad?  Do you know how much money Vietnam get from exporting and manufacturing? Do you know how much Vietnam get from investment? Shall I go on? Why don't you use Google and look it up and learn something instead of sitting here and spewing out ignorant statements after ignorant statements and making the whole world laugh at china and chinese (as if they haven't done that already).

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