Asia's Developing Future

Since the early 20th century, emerging Asia has been subjected to the ebb and flow of lending from advanced economies. Since then the region has become more integrated into the global financial market, which has been exposed to the risk of capital flow reversals.

In the aftermath of the 2008 global financial crisis, capital has flowed into emerging economies, especially in Asia, in search of higher returns on investment.

Low interest rates in advanced economies made Asia more attractive, with its higher interest rates promising bigger returns.

This worries the region’s policy makers. Portfolio investments are more volatile and short-lived than long-term foreign direct investments. A surge in inflows harms recipient countries, as asset prices soar, and a sudden withdrawal of capital destabilizes markets.

Read the transcript

http://bit.ly/2yniDUp

Read the working paper

https://www.adb.org/publications/correlations-equity-markets-asia-and-impact-capital-flow-management-measures

Author

Pornpinun Chantapacdepong was an ADBI research fellow and now assistant director at the Monetary Policy Group of the Bank of Thailand.

Know more about ADBI’s research on

Global Financial Crisis: http://bit.ly/2zpwYRR

Economic Integration: http://bit.ly/2AjebGY

Poverty among the elderly in developing countries such as India is on the rise as the traditional extended family unit dissolves, fertility rates decline, migration to urban jobs rises, and government attempts to improve aged care have left many falling through the gaps.

A small minority of workers in the formal sector are secure, but the vast majority of informal sector workers face poverty in their old age because they lack social protection.

To improve the income security of the elderly poor, the Indian government introduced the National Old Age Pension Scheme in 1995, a cash transfer to mitigate poverty faced by the elderly.

Read the transcript

http://bit.ly/2zy3pMA

Read the working paper

https://www.adb.org/publications/targeting-social-transfers-are-india-elderly-poor-left-behind

Author

Viola Asri, a PhD candidate at the University of Zurich and a visiting doctoral researcher at the Laboratory for Effective Anti-Poverty Policies at Bocconi University in Milan

Know more about ADBI’s research on pensions

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It’s been nearly a decade since the 2008 global financial crisis, and world economic growth rates are almost back where they were after a long, painful but instructive haul, and both developed and emerging economies have added a lot to their financial tool kits.

The International Monetary Fund predicts growth in developed countries will drop from the pre-crisis 2.2 percent to 1.5 percent, and in emerging economies from 7.5 percent to 5 percent between 2015 and 2020.

While high unemployment, huge debt in developed countries, excessive debt of enterprises in emerging economies, and overcapacity are to blame, declining productivity is another major culprit.

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http://bit.ly/2z45gNb

Read the blog post

https://www.asiapathways-adbi.org/2017/09/what-are-the-policy-options-for-reversing-productivity-decline/

Author

Li Xu is a research fellow at ADB

https://www.adb.org/adbi/about/staff-profiles/li-xu

Know more about ADBI’s research on productivity growth

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Parents in developing Asia tend to spend more on sons but receive higher returns from daughters, turning on its head an age-old belief that sons—not daughters—take care of their aging parents.

This is true in the People’s Republic of China, where children are expected to help their parents based on Confucian philosophy, which values filial piety and altruism. Data show that investments in daughters paid off better than money spent on sons. Daughters gave back to their aging parents financial support, and helped with tasks like shopping, housekeeping, accounting, food preparation, telephone calls, and transportation.

Read the transcript

http://bit.ly/2zyDip4

Read the working paper

https://www.adb.org/publications/son-biased-investments-and-old-age-support

Author

Christine Ho, School of Economics, Singapore Management University

Know more about ADBI’s research on supporting the elderly

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Low-skilled workers in Viet Nam are hardest hit by market reforms and technology, with efficiency coming at the cost of jobs. Exposure to foreign markets and access to digital technologies raise demand for different types of skills, and while it has been good for the economy, more and more workers are being left behind.

Read the transcript

http://bit.ly/2iiGGkd

Read the original report

https://www.adb.org/publications/impact-trade-and-technology-skills-viet-nam

About the authors

Jennifer Poole, American University and Institute of Labor Economics (IZA)

Amelia Santos-Paulino and Maria Sokolova, United Nations Conference on Trade and Development

Alisa DiCaprio, ADBI research fellow at the time the report was published

Read more about ADBI's research on

Trade: http://bit.ly/2ytVl1X

Viet Nam: http://bit.ly/2zeIo9M

Technology: http://bit.ly/2ijiqyr

Asia and the Pacific are home to 4.3 billion people, and half the world’s urban population, with 120,000 people moving to cities every day, creating daily demand for 20,000 affordable homes.

Some cities, where housing is scarce and costly because they don’t have enough land or they’re where the jobs are concentrated, find it hard to provide enough public housing for a continuously rising urban population.

Hong Kong, China; the Republic of Korea; and Singapore have wrestled with this problem for decades.

Read the transcript

http://bit.ly/2goPbKh

Read the original blog post

https://www.asiapathways-adbi.org/2017/08/housing-policy-in-the-republic-of-korea/

About the authors

Kyung-Hwan Kim is vice minister for land, infrastructure and transport, Republic of Korea

Miseon Park is an associate research fellow, Korea Research Institute for Human Settlements.

Additional information is from the following

From Slums to Sustainable Communities (https://www.habitat.org/sites/default/files/issue-paper.pdf)

Tackling Affordability in Asia (https://urbanland.uli.org/economy-markets-trends/tackling-affordability-asia/)

Waiting time to get into Hong Kong public housing shoots up a full year over past 12 months (http://www.scmp.com/news/hong-kong/education-community/article/2070493/waiting-time-get-hong-kong-public-housing-shoots).

Know more about ADBI’s research on housing in 2017

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Know more about ADBI’s research on housing in 2016

http://bit.ly/2hYPM24

Read The Housing Challenge in Emerging Asia: Options and Solutions

By Naoyuki Yoshino and Matthias Helble

https://www.adb.org/publications/housing-challenge-emerging-asia-options-and-solutions

Peer-to-peer lending is an emerging form of finance enabled by the Internet, matching investors with borrowers to get around rigid bank requirements faced by small and medium-sized enterprises—SMEs—and start-ups.

Borrowers apply to a peer-to-peer—P2P—platform of investors. The platform assesses the borrower’s credit risk and gives a credit score based on the platform’s own credit rating model. Investors then split up their money and lend it to borrowers, usually depending on the maturity of the loan and the risk entailed.

Read the transcript

http://bit.ly/2xL5QyY

About the speaker

David Storey was an analyst at the Asian Development Bank Institute at the time he presented his research. He is pursuing further studies at Warwick University, UK.

Know more about ADBI’s research on SMEs

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The idea of sharing future tax revenues with private investors is being promoted by the Asian Development Bank Institute—the ADBI—in Tokyo to help finance the region’s huge demand for infrastructure. But Naoyuki Yoshino, the dean of the institute, warns that future revenues need to be sustained for such financing to succeed in the longer term.

Japanese private railway companies played a major role in expanding the country’s transport sector in the 20th century. These companies were much more profitable than Japan National Railways, the public railway operator that was split up into seven private companies three decades ago after incurring massive public debt.

Read the transcript

http://bit.ly/2yV3gCA

About ADBI dean, Naoyuki Yoshino

https://www.adb.org/adbi/about/dean

Watch an ADBI video about spillover effects

http://bit.ly/2eZaTQM

Know more about ADBI’s work on spillover effects

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Remittances to developing countries in Asia help improve their economies with the net gains from exporting labor, and improve the lives of the poor people forced to work overseas—often for decades—because jobs are lacking at home.

A small gain in the contribution of remittances to gross domestic product has led to huge declines in poverty in 10 developing countries, notably Bangladesh, India, Nepal, Pakistan, and Sri Lanka in South Asia; and the People’s Republic of China, Indonesia, Malaysia, the Philippines, and Thailand in East and Southeast Asia.

A 1% rise between 1981 and 2014 parallels with a 22.6% decline in the poverty gap ratio and a 16.0% decline in the poverty severity ratio—taking into account the average poor household’s spending and the minimum income needed to pay for basic everyday needs.

Read the transcript

http://bit.ly/2xtH4Do

Read the blog post

https://www.asiapathways-adbi.org/2017/08/international-remittances-and-poverty-reduction/

Read the working paper

https://www.adb.org/publications/international-remittances-and-poverty-reduction

Authors

Naoyuki Yoshino is the ADBI dean

https://www.adb.org/adbi/about/dean

Farhad Taghizadeh-Hesary is a professor of economics at Keio University, Tokyo

https://www.asiapathways-adbi.org/author/farhad-taghizadeh-hesary/

Miyu Otsuka is a graduate student of economics at Keio University, Tokyo, and Science Po University in Paris

https://www.asiapathways-adbi.org/author/miyu-otsuka/

Know more about ADBI’s work on remittances

http://bit.ly/2zb1wpK

Economic corridors forming around the Greater Mekong Subregion have opened the way to greater development as better infrastructure leads to improved roads and bridges between neighbors.

The corridors are boosting economic growth in the GMS, and promoting intraregional trade and investment for Cambodia, Lao People’s Democratic Republic, Myanmar, Viet Nam, Thailand, and Yunnan Province and the Guanxi Autonomous Region in the People’s Republic of China.

Questions remain about the net benefits after the high cost of infrastructure; how evenly the benefits are spread; and how border security can be maintained in the face of trafficking of people, drugs, timber, wildlife, weapons, and black market goods.

Read the transcript

http://bit.ly/2xvHJ2l

Read the working paper

http://bit.ly/2y6Etia

About the author

Manabu Fujimura, a professor at Aoyama Gakuin University, Tokyo.

Know more about ADBI’s work

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