In 2011 the Asian Development Bank (ADB) published a report with the title Asia 2050. The report looks forward to the year 2050 and discusses how the 21st century could become the Asian Century. The thesis of the report is that if key Asian economies could escape the middle income trap, then Asia would become the dominant economic power, and this would be the Asian Century.
This is a serious challenge as only a few economies in Asia have to-date escaped the middle income trap. They are Japan, Korea, Taiwan, Hong Kong and Singapore. Countries could get stuck for a long time in a middle income trap. They are under pressure on wages and other costs from poorer countries and unable to compete on the basis of productivity and innovation with the developed richer countries. See illustration below.
In its 2013 report on key indicators, the ADB makes the following conclusions:
- Asia’s transformation has been fast but uneven
- Asia is a service and agriculture economy
- To escape the middle income trap and become a rich economy, Asia has to put more emphasis on industrialization.
These conclusions are summarized in the infographics below.
This Infographic is brought you by Retire in Asia