Accelerating economic growth since 2000…
The growth of per capita gross domestic product (GDP) in Asia
and the Pacific has accelerated over the past 16 years from an average of
1.4 per cent in 1990-2000 to 3.1 per cent in 2000-2005 and 4.6 per cent
in 2006. Since 2000, per capita GDP growth in the region has outpaced
that of all other regions of the world—except Africa—by a percentage point
or more. It has been consistently faster in low- and middle-income countries
than in high-income countries, more than twice as fast between 1995 and
2005.
…but slower job creation
Over the past 15 years, employment in Asia and the Pacific has grown
at an average annual rate of 1.5 per cent, much more slowly than in Africa
(2.8 per cent) and Latin America and the Caribbean (2.5 per cent). This
relative sluggishness in Asia and the Pacific is a result of the strong
long-term increase in labour productivity and the significant structural shift
in the sectoral composition of the economy. Within Asia and the Pacific,
employment has increased three times faster in low-income countries than
in high-income countries. The total employment figures in low-income
countries may, however, mask a large and persistent underutilization of
labour resources, particularly in the agricultural sector, which represents
more than half of their total employment.
The relative weak employment performance compared to the
population growth in Asia and the Pacific has caused a drop of about
4 percentage points in the employment-to-population ratio. Despite this
decline, the region still has the second highest ratio of working age women
employed (48.9 per cent) exceeded only by North America (53.9 per cent)
in 2006. South Asian countries, where the ratio has gradually fallen to an
average of 33.6 per cent in 2006, are the only exception.
The lack of access to decent work is one of the causes of migration
in the region from lower to higher income countries. In 2005, 6.0 per cent
of the population in the high-income countries of Asia and the Pacific was
foreign-born, compared with 4.7 per cent in 1990. The share of the foreign
population in the total population of low- and middle-income countries
decreased over the same period, from 1.4 per cent to 0.8 per cent and from
1.4 per cent to 1.1 per cent, respectively.
Economic growth supported by more rigorous macroeconomic policies…
The impressive per capita GDP growth in the region has been
underpinned by more rigorous macroeconomic policies, reflected especially
in lower fiscal deficits and lower inflation. Fiscal discipline was especially
lax in 1995 in the majority of the countries in South and Central Asia,
which ran fiscal deficits of between 5.1 per cent (India) and 11.5 per cent
(Kyrgyzstan) of GDP. In 2006, the average fiscal deficit in South Asia had
gone down to 3.5 per cent of GDP, while the Central Asian countries ran,
on average, a small fiscal surplus.
Average inflation in Asia and the Pacific decreased from 15.6 per cent
in 1995 to 3.5 per cent in 2006. The latter figure compared favourably to
those of Africa (8.2 per cent) and Latin America and the Caribbean
(5.1 per cent) and was only slightly higher than that of North America
(3.1 per cent).
In 1995, inflation was particularly high (265 per cent) in North and
Central Asia, where no country except Kyrgyzstan had a rate of less than
160 per cent and inflation in Turkmenistan even exceeded 1,000 per cent.
In 2006, the inflation rate in the subregion was down to 9.5 per cent, still
the highest among all groups of countries within Asia and the Pacific.
…faster global integration…
The increased integration of the countries of Asia and the Pacific into
the global economy has been another factor sustaining economic growth.
Exports of goods and services over GDP, which is an indicator of the
economy’s dependency on exports, increased from 19 per cent in 1990 to
33 per cent in 2005, a rise of 14 percentage points not matched by any
other region. The increase of imports over GDP—from 19 per cent in 1990
to 29 per cent in 2005—did not lag far behind.
The export performance of China has been especially impressive. In
1990, its exports over GDP were just 18 per cent, slightly lower than the
regional average, while by 2005 they had risen to 42 per cent, 9 percentage
points above the regional average. The export orientation of the Chinese
economy is unprecedented among populous countries with over 100 million
people. In comparison, exports over GDP stood at 21 per cent in India,
35 per cent in the Russian Federation, 34 per cent in Indonesia, 13 per
cent in Japan (2004), 15 per cent in Pakistan and 16 per cent in Bangladesh
in 2005. The countries of the Association of Southeast Asian Nations
(ASEAN) and Central Asia stand out as highly dependent on exports, with
their exports over GDP reaching 88 and 53 per cent, respectively.
The Asian and Pacific region is increasingly becoming not only
a destination for, but also a source of, foreign direct investment, which is
another indication of the key role it plays in globalization. In the list of
the world’s top 100 non-financial transnational corporations (TNCs) in
2005, nine were from Japan, and six out of the seven developing country
TNCs were from Asia and the Pacific (the Republic of Korea (2); Hong
Kong, China (2); Malaysia (2); and Singapore (2)). In the 2005 United
Nations Conference on Trade and Development (UNCTAD) list of the
top 100 non-financial TNCs from developing countries, the Asian and
Pacific region was home to 78 of the companies, with the majority coming
from Hong Kong, China (25), Taiwan Province of China (18), Singapore
(11) and China (10).
…and investment in transport infrastructure
A third factor explaining the acceleration of per capita economic
growth in the region is the investment in physical infrastructure. Road
density in China, for example, increased from 151 to 201 kilometres per
1,000 square kilometres between 1990 and 2004. Bhutan, Nepal, Viet Nam
and the Lao PDR almost doubled their road density in the same period,
while the Republic of Korea and India nearly doubled their road networks
in the 1990s. In addition to increasing total road length, the region has
also invested heavily in widening and paving roads in the existing network.
The increase in the length and quality of roads has contributed to
a remarkable rise in motorization rates—measured as the number of
passenger cars in use per 1,000 people—in the Asian and Pacific region.
In fact, the true level of personal mobility in many South and South-East
Asian countries is considerably higher than that suggested by the relative
number of cars in use, as two- and three-wheelers constitute more than
two thirds of all motorized vehicles. This improved mobility, while
contributing to economic growth, has drastically increased the level of
pollution and the number of traffic accidents.
Although railway density in Asia and the Pacific remains low in
comparison with more advanced regions, it is the highest among the
developing regions of the world. In 2005, it had a railway density of
7 kilometres per 1,000 square kilometres, ahead of Africa and Latin America
and the Caribbean but behind North America and Europe. Barely half of
the countries in the region have constructed a sizeable intercity railway
system. Moreover, only a handful of Asian developing countries have
invested extensively in railways in recent years and nearly the entire increase
in the region’s railway length is attributed to China and, to a lesser extent,
the Republic of Korea.
Impressive achievements in poverty reduction…
The accelerating growth in per capita GDP in Asia and the Pacific
has contributed to impressive social achievements since 1990, most
prominently in poverty reduction. In 1990, over a billion people—almost
a third of the region’s total population—lived in extreme poverty (on $1
a day or less). By 2004, this number had dropped to 641 million—17 per
cent of the population. The number of extreme poor dropped by over
360 million, which is more than the present combined population of
Pakistan and Bangladesh—the world’s sixth and seventh most populous
countries, respectively.
The reduction of extreme poverty in the region has been most
impressive in China, where the rate fell from 33 per cent in 1990 to
10 per cent in 2004 and to a lesser extent in India, where it dropped from
42 per cent in 1993 to 34 per cent in 2004. In contrast, the number
of people living in extreme poverty increased in sub-Saharan Africa
(by 65 million to 309 million) and Latin America and the Caribbean
(by 2 million to 48 million) between 1990 and 2004. The battle against
extreme poverty in Asia and the Pacific is, however, by no means won. A
number of least developed countries in the region are still struggling to achieve the poverty target of the MDG, making slow progress or even regressing with respect to the baseline year.
…accompanied by improvements in basic services…
The reduction of extreme poverty in the region has been accompanied
by improvements in basic services due to the increased proportion of
government expenditures allocated to health and education in most of the
Asian and Pacific countries since 2000. Partly because of increased
investments in education, for example, the number of children out of
primary school dropped by almost 50 million between 1990 and 2005, to
28 million. In more than half of the region’s countries, over 95 per cent of
children who should be attending primary school actually are. The most
notable exception in the region to universal primary enrolment is Pakistan,
where only two thirds of children go to school.
Universal enrolment can only be achieved if both girls and boys go
to school. It is the gradual removal of bias against girls that has contributed
most towards the goal of full enrolment. In 1991, only 88 girls in the region
attended primary school for every 100 boys; this number had increased to
nearly 96 by 2005. Pakistan and Afghanistan, however, are still far from
the regional average, with 76 and 59 girls respectively, enrolled for every
100 boys. Challenges still remain to ensure that children will successfully
complete the full course of primary education. This is especially a concern
for girls, who often risk dropping out of school to help in household chores.
Another outcome of improved access to basic services is the decline
in the number of people in the region who do not have access to safe water.
This figure fell from 829 million (25 per cent of the population) in 1990
to 659 million (17 per cent) in 2004. Access to basic sanitation, however,
improved considerably less. Despite some progress since 1990, more than
half of the population—almost 2 billion people—lacked access to basic
sanitation in 2004. The problem is particularly serious for rural dwellers,
two thirds of whom were unable to use basic facilities.
…have reduced morbidity and mortality
The combination of better living standards, improved access to basic
services and educational attainment in Asia and the Pacific has contributed
to reduced morbidity and mortality and increased longevity. The number
of new malaria cases, for example, fell by more than half in Asia and the
Pacific between 1990 and 2005, to just 80 cases per 100,000 people. This
is in stark contrast to the incidence of almost 7,000 cases per 100,000
people in Africa. Nevertheless, malaria remains a serious problem in Papua
New Guinea, Timor-Leste, Solomon Islands and Vanuatu.
The number of people infected with tuberculosis (TB) in the region
also fell considerably, from 13 million in 1990 to 9 million in 2005. The
prevalence of 238 cases of TB per 100,000 people is still, however, several
times that of all other regions of the world except Africa. TB remains
a serious issue in some of least developed countries (Cambodia, Timor-Leste
and Bangladesh), some Pacific Island Countries (Kiribati, Papua New
Guinea and Tuvalu) and the Philippines.
Partly due to the containment of these infectious diseases, the number
of children dying before the age of 5 in Asia and the Pacific decreased from
7.5 million in 1990 to 4.3 million in 2005 reducing the under-five
mortality rate by over a third during this period to 58 deaths per 1,000
live births. This rate, however, is still higher than the 1990 rate for Latin
America and the Caribbean. The Asian and Pacific countries with underfive
mortality rates exceeding 100 deaths per 1,000 live births in 2005 were
Afghanistan (257, among the highest in the world), Cambodia (143),
Myanmar (105) and Turkmenistan (104).
Asia and the Pacific is undergoing a “health transition” characterized
by a reduction in the prevalence of infectious diseases and rise in the
prevalence of non-communicable diseases. In 2005, chronic diseases
accounted for about two thirds of all deaths in the region; they are now
the leading cause of mortality in almost all subregions.
Higher longevity, lower fertility and population ageing
The reduction of death rates in almost all Asian and Pacific countries
has contributed to a further increase in life expectancy at birth. Between
1990 and 2005, this figure rose by 3 years for females, to age 70 and by
2.5 years for males, to age 66.2. Cambodia (59.5) and Afghanistan (42.1)
were the only countries in Asia and the Pacific with a female life expectancy
of less than 60 years in 2005. In Central Asia, life expectancy for men has
barely improved in fifteen years, increasing the gender gap to 7.8 years.
Improvements in health and education have given women in the Asian
and Pacific region greater control over the number of children they have.
The total fertility rate—the number of children a woman can expect to
bear during her lifetime if she experiences the current prevailing age-specific
fertility rates—dropped from 2.9 in 1990 to 2.4 in 2005. The decline has
been steepest in low-income countries, from 4.0 to 3.2. The fertility rate
in the middle- and high-income countries of the region was below the
population replacement rate of 2.1 in 2005.
Lower total fertility rates have led to a sharp decrease in the proportion
of children (below age 15) in the total population of Asia and the Pacific,
from 34.1 in 1990 to 28.5 in 2006. Children still represent one third of
the total population of low-income countries, but just 16.0 per cent of the
total population of high-income countries and some middle-income
countries. The ageing of the population has already become an issue for
high-income countries in the region, where the proportion of the elderly
(over age 65) in the total population reached 17.8 per cent in 2006; this
contrasts sharply with the 4.9 per cent share in low-income countries.
Challenges of rapid urbanization…
Human geography reached a turning point in 2008, with more people
living in cities than in rural areas for the first time in history. Although
Asia and the Pacific, along with Africa, is still one of the least urbanized
regions in the world, its urban population has been growing faster
than that of any other region during the past decade and a half. In 1990,
33.3 per cent of the population of Asia and the Pacific lived in urban areas,
compared with 40.9 per cent in 2006. The fastest influx of people from
rural areas to cities has occurred in ASEAN countries, where the share of
the urban population rose from 31.6 per cent in 1990 to 44.9 per cent in
2006.
The effects of this rapid urbanization on the region are being felt most
acutely in heavily populated slums, which are characterized by substandard
housing and poor access to basic services. In Asia and the Pacific,
approximately 4 out of 10 urban dwellers live in slums, compared with
6 out of 10 in Africa. Still, this is notably higher than the figure of
approximately 3 out of 10 prevailing in Latin America and the Caribbean.
Rapid urbanization is also largely responsible for the decrease in urban
access to improved water sources observed in Asia and the Pacific since
1990. Countries with high access rates in the 1990s—such as China,
Indonesia and the Philippines—have all recorded a decline in the
proportion of the urban population with access to improved sources of
water.
…and deterioration of the environment
Rapid economic growth has contributed considerably to better social
conditions, but it has also put a tremendous strain on the environment in
Asia and the Pacific. This is partly due to the rapid increase in energy
consumption in the region. Although still only a fraction of the levels of
North America and Europe, energy consumption per capita in Asia and
the Pacific more than doubled between 1990 and 2004, a rate of increase
not seen elsewhere in the world. In the middle-income countries of the
region, per capita energy use even quadrupled.
The increased energy use is reflected in the region’s carbon dioxide
(CO2) emissions, which increased from 1.9 tons per capita in 1990 to
3.2 tons per capita in 2004. High-income countries (10.3 tons per capita
in 2004) are considerably worse polluters than low-income (1.1 tons per
capita) and middle-income (4.1 tons per capita) countries. The increase in
CO2 emissions, however, was fastest in the latter group (doubled between
1990 and 2004).
Although CO2 emissions per capita in Asia and the Pacific are very
low compared with those in North America (20.3 tons in 2004), they are
increasing more rapidly than anywhere else in the world. This trend
compares unfavourably to that of Europe, which reduced per capita
emissions between 1990 (8.4 tons) and 2004 (7.9 tons).
The environment strain caused by rapid economic growth is also
making the population of Asia and the Pacific increasingly vulnerable to
the impact of natural disasters. The number of people in the region affected
by such disasters per 100,000 population rose from 5,542 in 1991-1995
to 6,731 in 2001-2005. This latter number compares unfavourably with
Africa (2,436), Latin America and the Caribbean (1,002), North America
(93) and Europe (72).
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