Does the new international economic environment allow for other developing countries to follow the successful experience in East Asia? To what extent can the development strategies of the latter be replicated elsewhere? These questions were addressed by Government officials, academics and other members of the civil society at an informal panel organized in UNCTAD on October 9.
The morning session focused on the changing international context in which new development strategies need to be designed and implemented. The discussions were introduced by two panellists: Professor Deepak Nayyar, Centre for Economics Studies, Jawaharlal Nehru University (India) and Mr. Philippe Frémeaux, Editor, Alternatives Economiques (France). Both recognised that globalization was posing new challenges for policy-makers in the developing world which were different from those facing East Asian policy-makers when they began their period of rapid growth. The persistent problems of slow growth and unemployment in the North could threaten the openness of the world trading system needed for developing countries to pursue export-oriented strategies. They saw a very real danger that asymmetries in the world economy could be exaggerated by globalization pressures - as had happened during an earlier period of globalization before the First World War - and advocated greater cooperation among developing countries, in response.
Two important insights emerged from the afternoon discussion on what could be learned from East Asia for the design and implementation of outward-oriented development strategies. Contrary to some popular explanations of their success, these countries did not begin with favourable institutional and resource conditions, but faced many of the problems familiar to other less developed economies, it was said. Moreover, there was not a single successful development recipe followed by all countries in the region but a diversity of paths which had led to rapid and sustained economic growth. Both points were seen as encouraging for developing countries now embarking on outward-oriented development strategies. The panellists at the afternoon session were Mr. Adrian Hewitt, Overseas Development Institute, Regent´s College (United Kingdom) and Professor Yasutami Shimomura, Graduate School of Policy Science, Saitama University (Japan).
Both speakers agreed that growth in East Asia had been invigorated through a mixture of complementary institutional reforms (notably the creation of a sound technocratic bureaucracy in charge of economic affairs), good governance and specific policy measures. These involved much more than prudent macroeconomic management. Appropriate industrial and effective manpower policies were among the additional prerequisites. They suggested that the tendency to deny active state intervention had been exaggerated, particularly in such critical areas as investment and export promotion.
The discussion also highlighted the role played by regional dynamics, particularly after the mid-1980s, including close trade and investment links among countries at different levels of economic and industrial development.
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Yilmaz Akyüz, Macroeconomic Section
Division on Globalization and Development Strategies
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