Davos was early in proclaiming that the 21st century would be the Asian Century. China’s miraculous development story is central to this vision—a transformation that would inevitably push the pendulum of global power from West to East. This tectonic shift was very much on the minds of most who attended my final Davos session of the year “China, India and Japan: Asia’s Big 3.”
Not so fast, I argued—even though I have made my own career bet on just such a possibility. Yet the Asian century is hardly as preordained as the Davos consensus seems to believe. The main reason, in my view, is that the region continues to rely far too much on exports and external demand. Developing Asia’s export share hit a record high of 47 per cent last year—up 10 full percentage points from levels prevailing in the late 1990s. That hardly speaks of a true economic power that has become increasingly capable of standing on its own.
