In 2020, Asian economies will become larger than the rest of the world combined - here's how
The re-emergence of Asia is among the most important shifts that will occur in our lifetimes.
Next year, in purchasing power parity (PPP) terms, Asian economies will become larger than the rest of the world combined for the first time since the 19th century. Not only is Asia growing richer; as it becomes more integrated, it is also coalescing as a constructive force for global governance.
This emergence is timely. From climate change and demographic crises to technological disruption and yawning inequality, the world faces myriad challenges that require multilateral solutions. However, a lack of global leadership and consensus has stalled reform of global institutions, leaving severe governance deficits.
While Asia has benefited enormously from globalization, it also encapsulates many of the world’s problems. Fortunately, there are growing signs that this vibrant, diverse continent can work together and rise to offer some of the solutions.
Towards a more integrated Asia
If this is to be the Asian century, it will be built by Asians working closer together in their own continent.
Despite Asia’s remarkable rise, its family of nations are often kept apart by difficult geography and even more difficult history. Fortunately, as the mutual benefits of cooperation become ever more apparent, efforts to overcome these barriers and deepen regional integration have gained momentum.
This is evident in the revival of China’s relationships with India, Japan, and South Korea, as well as the reboot of the China-Japan-ROK trilateral summit. Regional cooperation platforms such as APEC, ASEAN and the Shanghai Cooperation Organization are also proliferating.
Asia is also bucking the global trend for trade fragmentation, becoming instead ever more economically integrated via trade, investment and tourism. Previously, this happened from the grassroots up, without an overarching regional free trade agreement of the sort that spurred integration in Europe and North America.