From The Star

In April I shall be starting on a new series of articles that explore the challenges that Asia faces in its next phase of globalization.

Asia has been a major beneficiary of globalization, having built the global production chain that supplies the West with consumer goods.

The global financial crisis of 2007-2009 opened a whole can of worms about the benefits of globalization, as the confidence of the West was shaken to the core.

Some people think that the rise of Asia is inevitable, going so far as to say that China will overtake the United States as No. 1. But as the Asian Development Bank study on Asia 2050 reminded us, nothing is pre-ordained or inevitable. China has to break out of the middle income trap first, as do Thailand, Malaysia and a number of Asian economies.

Indeed, the withdrawal of quantitative easing (tapering) has shaken the confidence of many emerging markets, exposing their vulnerability to hot capital flows. Financial markets today worry about the Fragile Five – Indonesia, India, Brazil, Turkey and South Africa. If advanced markets are on the recovery track, who needs to invest in high-risk emerging markets?

As Dr Victor Fung said at the Fung Global Institute Asia-Global Dialogue last December, “Asia needs to re-think traditional approaches to growth, employment and sustainability, given the combined impacts of re-balancing, changing demographics, urbanization and environmental stresses.”

The problem is not that we are confident of our future, but that we are all insecure. This is no longer a unipolar world, but a multipolar situation where no one is fully in charge.

Because Asia is a mosaic of different countries, cultures and even civilizations, there can be no single voice in Asia. The future of Asia will be shaped by the confluence of these differences and their complex engagement with the West.

Read more at The Star