From Chinese Press

China to contribute most to 'Asian century'

By Ji Peijuan & Wu Chengliang (peopledaily.com.cn)
Updated: 2011-05-06 16:13

If Asia's major economies can overcome the middle income trap and maintain their current growth rate, more than 3 billion Asians will become affluent by 2050 and the world will enter into the "Asian century," according to the "Asia 2050: Realizing the Asian Century" report released by the Asian Development Bank (ADB) in Hanoi, capital of Vietnam, on May 4. The bank also held a related seminar. The region's GDP will increase from 16 trillion U.S. dollars in 2010 to 148 trillion U.S. dollars by 2050, with its share of global GDP climbing from 27 percent in 2010 to 51 percent by 2050.

"Asia is expected to become a prosperous region by the middle of this century. However, this is not bound to happen and will meet major challenges," the report said, "If Asia wants to fulfill its potential and achieve the 'Asian century,' it needs to make necessary reforms and cope with environmental challenges in addition to maintaining high-speed economic growth."

The report shows six key factors that can advance Asia's sustainable growth – technological change, labor, capital, the emerging middle class, climate change and the communications revolution.

The report also predicted another possibility that the fastest-growing Asian economies of China, India, Indonesia and Vietnam will fall into the middle income trap featuring slower economic growth and stagnant income levels over the next five to 10 years. Thus, Asia's GDP in 2050 would reach only 61 trillion U.S. dollars or 32 percent of the world's total.

"There are many challenges and risks on the road of prosperity," Haruhiko Kuroda, president of the ADB, said during the seminar. He said that as Asia has more than half of the world's population, it must reduce the growing economic imbalances and the environmental degradation caused by the over-exploitation of resources to avoid the middle income trap.

Experts from the ADB said in order to address various risks and challenges, leaders of Asian countries must design bold and innovative domestic policies and explore means of regional and global cooperation. Experts also said that policies that are implemented during Asia's low-income and capital scarcity era are unlikely to be effective in the future.

A report from the ADB shows that although Asia's impact resistance has improved and Asia has quickly gotten out of the recent global economic recession, it should not be complacent. Asia must continue to take a cautious macroeconomic policy to improve the vitality of the financial system and enhance its impact resistance. The report also pointed out that although developing Asian economies have made great progress in the eradication of poverty, the poverty problem is still widespread. Half of the population in Asia still lacks basic sanitary conditions, and 900 million people still live without electricity.

Rajat Nag, executive director-general of the ADB and one of the authors of the report, said that China is the largest economy in Asia and will be the largest contributor to the realization of the "Asian century." China is also a huge market for other developing countries in Asia and will play a key role in the development of Asia in the future.