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| The term '''East Asian Tigers''' ({{zh-stp|s=亚洲四小龙|t=亞洲四小龍|p=Yǎzhōu sì xiǎo lóng}} (lit. ''Four Asian ]'')) refers to the ] of ''']''', ''']''', ''']''', and ''']'''. They are also known as '''Asia's Four Little Dragons''' |
The term '''East Asian Tigers''' ({{zh-stp|s=亚洲四小龙|t=亞洲四小龍|p=Yǎzhōu sì xiǎo lóng}} (lit. ''Four Asian ]'')) refers to the ] of ''']''', ''']''', ''']''', and ''']'''. They are also known as '''Asia's Four Little Dragons''' These countries and territories were noted for maintaining high ] rates and rapid ] between the early ] and ]. | ||
| ] is the ] and hub of economic transactions in Singapore, and is also the home of the ], Asia-Pacific's first demutualised and integrated securities and derivatives exchange.]] | ] is the ] and hub of economic transactions in Singapore, and is also the home of the ], Asia-Pacific's first demutualised and integrated securities and derivatives exchange.]] | ||
| The four Tigers |
The four Tigers pioneered what has come to be seen as a particularly "Asian" approach to ]. Key differences include initial levels of ] and physical access to world markets (in terms of transport infrastructure and access to coasts and navigable rivers, which are essential for cheap shipping). | ||
| == Characteristics of the Tiger economies == | == Characteristics of the Tiger economies == | ||
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| In the aftermath of the 1997 Asian Financial/Economic Crisis, many so called 'Asian Tigers' countries suffered deep depreciation of their currencies, stock market prices declined and social and political unrest. This was due to the withdrawal of foreign and domestic capital out of the East Asian countries such as ], ], ], ], ], ], and the ]. Prior to the financial crisis, all the Asian economies were enjoying very high economic growth, high interest rates to attract ]. | In the aftermath of the 1997 Asian Financial/Economic Crisis, many so called 'Asian Tigers' countries suffered deep depreciation of their currencies, stock market prices declined and social and political unrest. This was due to the withdrawal of foreign and domestic capital out of the East Asian countries such as ], ], ], ], ], ], and the ]. Prior to the financial crisis, all the Asian economies were enjoying very high economic growth, high interest rates to attract ]. | ||
| Some economies were becoming overheated, stock prices were overvalued, property prices were sky-high and investors were jittery and nervous. Because of the structural weaknesses in the regulatory framework, once '''capital flight''' began, the stock market nosedived and the major Asian currencies depreciated significantly. This caused social unrest, political instability, regime change and financial bailing out by the ]. This also gave impetus to some Asian governments to impose capital controls to restrict currency outflows and maintain monetary and financial stability. ] maintained a ] to the US Dollar. The ] |
Some economies were becoming overheated, stock prices were overvalued, property prices were sky-high and investors were jittery and nervous. Because of the structural weaknesses in the regulatory framework, once '''capital flight''' began, the stock market nosedived and the major Asian currencies depreciated significantly. This caused social unrest, political instability, regime change and financial bailing out by the ]. This also gave impetus to some Asian governments to impose capital controls to restrict currency outflows and maintain monetary and financial stability. ] maintained a ] to the US Dollar. The ] created legislation requiring all outgoing capital transfers to be declared. However, there were no direct restrictions. | ||
| Since the crisis most of the Tiger economies have become financially stable with resilient institutions and companies and regulatory frameworks in place to prevent another crisis. This has also shown many Asian governments that the easy and predictable prosperity of export-led growth and cheap labour costs won't last forever. To better compete with the emerging manufacturing giants like ] and ], they will have to create new industries, move up the value-add chain and create stronger services sectors in their economies. | Since the crisis most of the Tiger economies have become financially stable with resilient institutions and companies and regulatory frameworks in place to prevent another crisis. This has also shown many Asian governments that the easy and predictable prosperity of export-led growth and cheap labour costs won't last forever. To better compete with the emerging manufacturing giants like ] and ], they will have to create new industries, move up the value-add chain and create stronger services sectors in their economies. | ||
| == Comparisons == | |||
| === Other "Tigers"=== | |||
| Over time, the term ''Tiger'' has become synonymous with nations that achieve high growth by pursuing an ]-driven ] strategy. This entails creating ] to attract high levels of ]s. Recently, the ]n nations of ], ], the ] and ] have sometimes been considered ''Tigers'' or the ''Four New Asian Tigers''. The term is not limited to Asian nations; in ], the ] has been called the ] for its rapid growth in the ]s, while ] is known as the ] for its presently high growth rates while ] has also been referred to as the ] for its solid economic policies and rapid export-led growth since the ]. | |||
| === Mainland China === | |||
| {{main|Economy of the People%27s Republic of China}} | |||
| ], ] (南京路), one of the world's busiest shopping streets.]] | |||
| Comparison between ] and the Tigers can be divided between the ] era and the ] starting with ]. The main question that has been raised with respect to the Maoist era is to what extent the economic performance of the Tigers was reproducible in Mainland China in the 1960s. The main question that has been raised with respect to the post-Maoist era is to what extent the development of the PRC is sustainable. | |||
| An important question is the relevance of the experience of the Tigers to current economic growth in Mainland China. In the 1980s it was common to argue that the export-centered growth of the Tigers was of limited relevance to Mainland China because the Tigers were small and any effort to mimic them would result in more exports than the developed world could handle. This objection was later less often raised since the pattern of economic growth has been for exports to trigger economic growth in the coastal regions, and for these coastal regions to serve as markets and triggers for growth in the interior. | |||
| Since the late 1990s, some of the heat has dissipated from this debate, in part because its become of more historical than current interest: as a result of the Deng Xiaoping reforms, the PRC has one of the world's highest rates of per capita ] growth. Furthermore, the ] and ] today both view ] as a common adversary and are much less likely to assert superiority over the other. Ironically, and to the chagrin of many western observers, it is now common for the Communist Party of China to use the experience of the Asian Tigers as justification for its authoritarian rule. The argument by the Party is that at the current stage of economic development the PRC needs a non-democratic system similar to those that the Tigers had in the early years of growth. | |||
| ===India=== | |||
| {{main|Economy of India}} | |||
| ] in Southern India]] | |||
| ] has not had a land reform as consistent and thorough as ] or ]. The liberalisation of the post-colonial ] occurred in ] under the finance minister, ], the current ]. With the collapse of the ], ]'s ]-inspired economic policies which had stagnated growth in the ], after initial periods of success in recovering the country from ], were put under pressure as ]'s main supporter disappeared, and a balance of payment crisis, as well as rapid decline in ] reserves threatened financial meltdown. | |||
| ] has a large intellectual and educated class able to export services. This will assist the transition and evidence of it can already be seen with the growth of the software and ] industries. As the intellectual class and consumer demand for home produced items grow, the skilled worker class will benefit and this will help to speed up India's economic transition. India is on the path of continuous development, but its policy of development is not similar to the policies of the tigers. The current flow of ] stands at 5 billion dollars for the year ]-]. It currently is the fourth largest economy in the world (by PPP terms) and is expected to overtake ] by the end of 2006 making it the third largest economy in the world. | |||
| Some fringe scholars maintain that the success of the four tigers is related to a ] ethos, and that India, with its largely ] will have difficulties replicating their results. Others maintain that the development of India has refuted this claim, with ] only lagging because economic reforms occurred 10 years after those of China. In addition, India and ] culture share similar values such as philosophy (]/]). | |||
| === Taiwan and Mainland China compared === | |||
| ] is Taiwan's largest city and financial center.]] | |||
| ].]] | |||
| ] gave birth to numerous electronics companies in the 1980s such as ]. Many of these companies are now located at the nearby ].]] | |||
| The Asian Tigers' spectacular ascent to economic prominence attracted much attention and analysis. Some Western economists, notably at the ], depicted it as a vindication of ] principles, and this interpretation of the Tigers' success formed large part of the ]. This view is not without controversy. Many economists have pointed out that the governments of the tigers were quite active in their economies. East Asian Tigers all practiced aggressive land reform and made large investments in public health and elementary education. In addition, while the tigers relied on export markets to develop their economies, they also put in place high trade barriers which protected local industries from foreign competition. Some Western observers have argued that ] would have reached Taiwan's contemporary level of development if the ] had stayed in power. However, this claim has been disputed by those who point out that Taiwan is by no means a microcosm of the Mainland. | |||
| First, one million ] supporters fled to the island in 1949, establishing the small island of six million as the seat of the ]. ] thus benefited from the flight of many well-educated, bourgeois Chinese. A disproportionately high share of the immigrants were governing elites, merchants, Chinese capitalists, and well-educated professionals. While a large number (60%) were also poorly-educated ] soldiers, the wave of immigrants was not a reflection of Chinese society. Furthermore, many in the ROC leadership accused of corruption and incompetence on the mainland were either exiled or purged from the ] following defeat in the ]. | |||
| Second, ], and for that matter all four of the Tigers, benefitted economically from previous foreign rule or influence, whether it was ] commerce in ] and ], or ]ese industrialization and ] land reform in ]. Furthermore, three of the Tigers were an artificial polities severed from larger neighbors—] in the case of ] and ], ] in the case of Singapore (the latter two are also city-states). Likewise, South Korea was a product of postwar division and bloody civil war. Each therefore felt acute insecurity, which was translated into political structures that restricted civil liberties and subordinated short-term social well-being for economic growth. | |||
| Third and perhaps most important, Taiwan's economy, wrenched in quick succession from Japan's orbit and then mainland China's, could not have developed without direct American aid, which constituted more than 30 percent of domestic investment from ] to ]. Land reform, government planning, U.S. aid and investment, and free universal education brought huge advancement in industry and agriculture, and in living standards. In addition, land reform was an essential step in modernization. In conducting land reform on Taiwan, ] was aided by American encouragement in addition to the fact that many of the large landowners were Japanese who had fled there after ], and the remaining indigenous landowners had little voice in government. Most agree that it is extremely unlikely that ] would have revolutionized Mainland Chinese society to that extent if he had defeated the Communists led by ]. | |||
| In summary, the transformation of ] cannot be understood without reference to the larger geopolitical framework. Although aid was cut back in the 1970s, it was crucial in the formative years, spurring industrialization. In addition, even after the cutoff of aid, security and economic links were maintained. Uncertainty about the U.S. commitment accelerated the country’s shift from subsidized import-substitution in the 1950s to later export-led growth. Like ], ] moved from cheap, labor-intensive manufactures, such as ]s and ]s, into an expansion of heavy industry and infrastructure in the 1970s, and then to advanced ] in the subsequent decades. In response, it has been argued that the role of ] aid and direct investment is overstated. In particular, it is pointed out that the capital for investment came largely from indigenous sources and that foreign aid had ended before the economy had taken off. | |||
| == See also == | == See also == | ||
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| *] | *] | ||
| *] | *] | ||
| *] | |||
| *] | *] | ||
Revision as of 21:56, 24 June 2006
The term East Asian Tigers (simplified Chinese: 亚洲四小龙; traditional Chinese: 亞洲四小龍; pinyin: Yǎzhōu sì xiǎo lóng (lit. Four Asian Dragons)) refers to the economies of Hong Kong, Taiwan, Singapore, and South Korea. They are also known as Asia's Four Little Dragons These countries and territories were noted for maintaining high growth rates and rapid industrialization between the early 1960s and 1990s.
The four Tigers pioneered what has come to be seen as a particularly "Asian" approach to economic development. Key differences include initial levels of education and physical access to world markets (in terms of transport infrastructure and access to coasts and navigable rivers, which are essential for cheap shipping).
Characteristics of the Tiger economies
The East Asian Tigers pursued an export-driven model of economic development; these countries and territories focused on developing goods for export to highly-industrialized nations. Domestic consumption was discouraged through government policies such as high tariffs. The East Asian Tigers singled out education as a means of improving productivity; these nations focused on improving the education system at all levels; heavy emphasis was placed on ensuring that all children attended elementary education and compulsory high school education. Money was also spent on improving the college and university system.
Since the East Asian Tigers were relatively poor during the 1960s, these nations had an abundance of cheap labor. Coupled with educational reform, they were able to leverage this combination into a cheap, yet productive workforce. The East Asian Tigers committed to egalitarianism in the form of land reform, to promote property rights and to ensure that agricultural workers would not become disgruntled. Also, policies of agricultural subsidies and tariffs on agricultural products were implemented as well.
The common characteristics of the East Asian Tigers are:
- Focused on exports to richer industrialized nations
- Trade surplus with aforementioned countries
- Sustained rate of double-digit growth for decades
- Non-democratic and relatively authoritarian political systems during the early years
- Undervalued currencies
- High level of U.S. treasury bond holdings
- High savings rate
- A high degree of what is referred to as economic freedom. Hong Kong, Singapore, Taiwan and South Korea are 1st, 2nd, 37th, and 45th respectively on the Heritage Foundation's Index of Economic Freedom.
Economic success in Japan, followed by the baby east Asian Tigers, has been attributed to the existence of harmonious labor-management relations. “Industrial Harmony” is this unique “Culture of harmony” that was consciously invented and developed over the last century in Japan. A semi-bureaucratic organization called the “Kyochokai” (The Co-operation and Harmony Society) was established in 1819 to meet the needs of an emerging industrial society. The “Kyochokai” took the lead in trying to define the values which would be suitable for a new Japanese-style industrial society, at the time of great social troubles in industrial Europe. The resulting “invented” tradition has played an important role in the evolution and character of Japanese economic values and behavior of social peace for economic development.
Japanese experience appears to challenge unilinear theories of modernization, and to suggest that Japan’s uniqueness lies in the creation of her own kind of modernity, sharply divergent from that to be found in Western countries, and based paradoxically upon a reaffirmation of ancient Confucian values and native Japanese tradtions of harmony, self-sacrifice and non-individualistic group striving in pursuit of a common cause. Japan’s emphasis on long-term growth, scrupulous market evaluation, and process engineering are all well regarded as important components of its economic development.
This "Industrial Harmony" is the foundation ("Grund" as it used to be) of "Asian Political economy".
Criticism of the export-driven trade model
The East Asian Tigers were strongly affected by the 1997 Asian financial crisis, which impacted each Tiger to varying degrees. While Taiwan was not as strongly affected, South Korea was badly battered by the crisis. Because of the focus on export-driven growth, many of the Tigers became caught up in a game of currency devaluation. The current criticism of the East Asian Tigers is that these economies focus exclusively on export-demand, at the cost of import-demand. Thus, these economies are heavily reliant on the economic health of their targeted export nations. In addition, these nations have met difficulties after they lost their initial competitive edge, cheap productive labour. India and China have now emerged as fast-growing economies based on cheap labour, largely replacing the Tigers.
Asian Financial Crisis
In the aftermath of the 1997 Asian Financial/Economic Crisis, many so called 'Asian Tigers' countries suffered deep depreciation of their currencies, stock market prices declined and social and political unrest. This was due to the withdrawal of foreign and domestic capital out of the East Asian countries such as Thailand, Malaysia, Taiwan, Hong Kong, Singapore, South Korea, and the Philippines. Prior to the financial crisis, all the Asian economies were enjoying very high economic growth, high interest rates to attract foreign investments.
Some economies were becoming overheated, stock prices were overvalued, property prices were sky-high and investors were jittery and nervous. Because of the structural weaknesses in the regulatory framework, once capital flight began, the stock market nosedived and the major Asian currencies depreciated significantly. This caused social unrest, political instability, regime change and financial bailing out by the International Monetary Fund. This also gave impetus to some Asian governments to impose capital controls to restrict currency outflows and maintain monetary and financial stability. Malaysia maintained a currency peg to the US Dollar. The Taiwan created legislation requiring all outgoing capital transfers to be declared. However, there were no direct restrictions.
Since the crisis most of the Tiger economies have become financially stable with resilient institutions and companies and regulatory frameworks in place to prevent another crisis. This has also shown many Asian governments that the easy and predictable prosperity of export-led growth and cheap labour costs won't last forever. To better compete with the emerging manufacturing giants like China and India, they will have to create new industries, move up the value-add chain and create stronger services sectors in their economies.