Trade and Industrial Development in East Asia

Trade and Industrial Development in East Asia

Catching Up or Falling Behind

Peter C.Y. Chow

Trade as an engine of growth has played a catalyst role in East Asian development; through vigorous study of performances in past decades, East Asian trade and industrialization experiences may offer some lessons for other developing countries. This book covers trade and industrial structures for ten countries and regions including Japan, China, Hong Kong, Korea, Singapore, Taiwan, Indonesia, Malaysia, the Philippines and Thailand.

Preface

Peter C.Y. Chow

Subjects: asian studies, asian economics, economics and finance, asian economics, international economics

Extract

Rapid economic growth in East Asia was initiated by Japan’s post-war industrialization and expansion of exports to the world. Japan’s export-led growth model was adopted shortly afterwards in the 1960s by the first tier of the Newly Industrialized Countries (NICs). The original members of the Association of Southeast Asian Nations (ASEAN), sometimes called the second tier of the NICs, arguably replicated the export-promotion strategy of Japan and the first tier of the NICs, and have thereby experienced modest strong economic growth since the 1970s. After its economic reform and openness in 1979, China shifted from being a self-sufficient and autarchic economy to instead depend on trade. These three groups of countries – the industrialized Japan, the first tier of the NICs, and the second tier of the NICs plus China – dominated the economic dynamism of East Asia for more than half of a century from 1960 to 2010 and have become major trading countries in the world economy in the 21st century. Over decades of export-led growth, East and Southeast Asian countries have generated not only impressive records of GDP growth and trade, but also industrial developments, which have structurally transformed their economies with various degrees of success. Though there is no consensus on East Asian models of development, most developmental economists tend to believe that trade is the engine of growth in the region and reject the trade pessimism school of thought, which is probably more relevant to other developing countries. The development of East and Southeast Asia through the...