{ "title": "Asia-Pacific Region: Gearing Up for the Next Transformation", "publication": "IMF News, September 6, 2017", "sourceUrl": "https://www.imf.org/en/news/articles/2017/09/06/sp090617-asia-pacific-region-gearing-up-for-the-next-transformation", "canonical": "https://www.imf.org/en/news/articles/2017/09/06/sp090617-asia-pacific-region-gearing-up-for-the-next-transformation", "overlayPath": "/en/news/articles/2017/09/06/sp090617-asia-pacific-region-gearing-up-for-the-next-transformation/index.md", "summary": "Asia’s future is built on its cultural diversity, resourcefulness, and entrepreneurship.", "authors": [ "Christine Lagarde" ], "publishDate": "2017-09-06", "sections": [ { "heading": "Introduction: Asia Today and Tomorrow", "content": "- Asia’s future is built on its cultural diversity, resourcefulness, and entrepreneurship.\n- Over the past decade, the Asia-Pacific region has contributed two thirds of global growth, and now accounts for about 44 percent of global GDP.\n- Emerging and developing Asia contributed 56 percent to global growth from 2007-2016 (GDP measured at purchasing power parity).\n- New vulnerabilities include high corporate debt, the risk of protectionism, population ageing, and lower productivity growth.\n- Policy response emphasis: bold policy actions and strong international cooperation; “relentless focus on training, on the nitty-gritty of economic reform.”" }, { "heading": "Seizing the Demographic Opportunities", "content": "- Demographic dynamics:\n - Young and growing populations in India, Indonesia, and the Philippines present potential to reap a demographic dividend.\n - Rapid ageing in China, Japan, Korea, and Thailand could lead to smaller workforces and potentially lower productivity growth.\n- Quantified impacts:\n - IMF analysis shows that a growing workforce can add one full percentage point to annual GDP growth over the next three decades.\n - We estimate that ageing countries could face lower annual GDP growth, again by up to a percentage point.\n- Policy levers to increase labor force participation and inclusiveness:\n - Boost the proportion of women in the workforce (examples: reform secondary earner taxation; boost childcare benefits and tax incentives for part-time work in Korea and Japan).\n - Expand girls’ access to high-quality education and promote women’s access to finance in emerging and developing countries such as Cambodia and India.\n - Strengthen social safety nets and pension systems (example: Korea’s budget includes transfers to the elderly, subsidies for job-seeking youth, and higher unemployment benefits; stronger pension systems facilitate transition to consumption-led growth in China).\n- Potential GDP gains from closing gender gaps:\n - Japan: boost GDP by 9 percent.\n - Korea: boost GDP by 10 percent.\n - India: boost GDP by 27 percent." }, { "heading": "Boosting Productivity", "content": "- Long-term importance: productivity growth is the most important source of higher income and rising living standards.\n- Regional patterns:\n - Countries such as Bangladesh, India, and Indonesia benefit from steady investment that can boost innovation and potential growth.\n - Sharp slowdown in productivity growth since the global financial crisis observed in China, Japan, Korea, and Thailand.\n- Quantified counterfactual:\n - We estimate that, if productivity growth had followed its pre-2008 crisis trend, overall GDP in the Asia-Pacific region would be about 9 percent higher today.\n- Policy recommendations to raise productivity:\n - Foster innovation through tax incentives for research and development, and increased investment in infrastructure and education reform.\n - Emphasize vocational training to reduce skills mismatches (Korea and Vietnam highlighted for educational achievement).\n - Reduce overly stringent regulations to encourage entrepreneurship and new ventures, including in smartphone apps, e-commerce, and fintech.\n - Expand trade to promote innovation-sharing and investment in new technologies and efficient practices.\n- Trade evidence:\n - China’s integration into the global trading system accounted for as much as 10 percent of the average overall productivity increase in advanced economies between the mid-1990s and mid-2000s.\n- Social and distributional considerations:\n - Structural change can cause job losses in shrinking sectors and social challenges; countries and the international community share responsibility to pursue better and smarter trade agreements with protections for labor and environmental standards." }, { "heading": "The IMF as a Partner", "content": "- IMF’s role: engage through analysis, policy advice, hands-on assistance, and training to strengthen institutions and economic management.\n- Country example:\n - Myanmar: IMF helped modernize tax administration, revamp the central bank and foreign exchange market, build a statistics program, and strengthen the anti-money laundering regime.\n- Institutional adaptations and cooperation:\n - Reassessment of the role of capital flow management measures since 2010 (Korea chaired the G20 in 2010).\n - Efforts to strengthen the global financial safety net by enhancing the IMF toolkit and deepening cooperation with regional financing arrangements, including the Chiang Mai Initiative.\n - Governance changes: with the most recent quota reforms, the BRIC countries are now among our top 10 shareholders.\n- Framing: the IMF positions itself as a “fitness coach” helping members manage demographic pressures, climate change, and new technology." }, { "heading": "Conclusion", "content": "- Asia’s next transformation requires continued “training” in policy reform, education, and institutional strengthening to improve lives across the region and globally.\n- The region’s young entrepreneurs and students exemplify the potential to lead the next transformation.\n\nSpeech by Christine Lagarde, IMF Managing Director, International Conference, Seoul, September 6, 2017.\n\n---\n\n\n References\n\n- Christine Lagarde\n- People's Republic of China and the IMF\n- Cambodia and the IMF\n- India and the IMF\n- Indonesia and the IMF\n- Japan and the IMF\n- Myanmar and the IMF\n- Republic of Korea and the IMF\n- Thailand and the IMF\n- Vietnam and the IMF\n- Speeches\n- PRESS CENTER\n- https://www.imf.org/en/home\n\nSource: https://www.imf.org/en/news/articles/2017/09/06/sp090617-asia-pacific-region-gearing-up-for-the-next-transformation" } ], "bullets": [ "[Markdown version](/en/news/articles/2017/09/06/sp090617-asia-pacific-region-gearing-up-for-the-next-transformation/index.md)", "[Structured JSON version](/en/news/articles/2017/09/06/sp090617-asia-pacific-region-gearing-up-for-the-next-transformation/index.json)", "[Bundle manifest](/en/news/articles/2017/09/06/sp090617-asia-pacific-region-gearing-up-for-the-next-transformation/bundle-manifest.json)", "Authors: Christine Lagarde", "Published: September 6, 2017", "Asia’s future is built on its cultural diversity, resourcefulness, and entrepreneurship.", "Over the past decade, the Asia-Pacific region has contributed two thirds of global growth, and now accounts for about 44 percent of global GDP.", "Emerging and developing Asia contributed 56 percent to global growth from 2007-2016 (GDP measured at purchasing power parity).", "New vulnerabilities include high corporate debt, the risk of protectionism, population ageing, and lower productivity growth.", "Policy response emphasis: bold policy actions and strong international cooperation; “relentless focus on training, on the nitty-gritty of economic reform.”", "Demographic dynamics:", "Quantified impacts:", "Policy levers to increase labor force participation and inclusiveness:", "Potential GDP gains from closing gender gaps:", "Long-term importance: productivity growth is the most important source of higher income and rising living standards.", "Regional patterns:", "Quantified counterfactual:", "Policy recommendations to raise productivity:", "Trade evidence:", "Social and distributional considerations:", "IMF’s role: engage through analysis, policy advice, hands-on assistance, and training to strengthen institutions and economic management.", "Country example:", "Institutional adaptations and cooperation:", "Framing: the IMF positions itself as a “fitness coach” helping members manage demographic pressures, climate change, and new technology.", "Asia’s next transformation requires continued “training” in policy reform, education, and institutional strengthening to improve lives across the region and globally.", "The region’s young entrepreneurs and students exemplify the potential to lead the next transformation.", "[Christine Lagarde](https://www.imf.org/en/About/senior-officials/Bios/christine-lagarde)", "[People's Republic of China and the IMF](http://www.imf.org/external/country/CHN/index.htm)", "[Cambodia and the IMF](http://www.imf.org/external/country/KHM/index.htm)", "[India and the IMF](http://www.imf.org/external/country/IND/index.htm)", "[Indonesia and the IMF](http://www.imf.org/external/country/IDN/index.htm)", "[Japan and the IMF](http://www.imf.org/external/country/JPN/index.htm)", "[Myanmar and the IMF](http://www.imf.org/external/country/MMR/index.htm)", "[Republic of Korea and the IMF](http://www.imf.org/external/country/KOR/index.htm)", "[Thailand and the IMF](http://www.imf.org/external/country/THA/index.htm)", "[Vietnam and the IMF](http://www.imf.org/external/country/VNM/index.htm)", "[Speeches](https://www.imf.org/en/news/searchnews)", "[PRESS CENTER](http://presscenter.imf.org/)", "[https://www.imf.org/en/home](https://www.imf.org/en/home)" ], "alternates": { "markdown": "/en/news/articles/2017/09/06/sp090617-asia-pacific-region-gearing-up-for-the-next-transformation/index.md", "json": "/en/news/articles/2017/09/06/sp090617-asia-pacific-region-gearing-up-for-the-next-transformation/index.json", "bundleManifest": "/en/news/articles/2017/09/06/sp090617-asia-pacific-region-gearing-up-for-the-next-transformation/bundle-manifest.json" }, "generatedAtUtc": "2026-09-25T21:10:10.146Z" }