Insights from the 2018 Asian Development Outlook
On the latest Policy Forum Pod, we chat with leading economists from the Asian Development Bank about what the fourth industrial revolution will mean for the Asia-Pacific.
The first industrial revolution saw the rise of the steam engine. The second saw electricity and mass production, while the third led us to computers, the Internet, and the arrival of the Digital Age. Many say we’re now entering the fourth industrial revolution, where robotics, big data, and artificial intelligence will fundamentally change the nature of work in the 21st century. What will this change mean for the Asian region – currently the world’s most dynamic economy? In this week’s podcast, we chat with two economists from the Asian Development Bank about the 2018 Development Outlook report, and hear forecasts for growth for Asia and the Pacific as technology starts to change the future of work. Listen here: http://bit.ly/PFPwork
Valerie Mercer-Blackman is Senior Economist at the Economics Research and Regional Cooperation department of the Asian Development Bank.
Ananya Basu is Principal Economist from the Asian Development Bank’s Pacific Department.
The Asian Development Outlook is the ADB’s flagship annual report. It provides an economic forecast for the countries of the Asia-Pacific.
As Valerie explains, 2017 was a very good year for Asia’s economic growth, with the region expected to grow healthily to around 6 per cent over 2018.
“Looking forward to 2018 and 2019… we think that this momentum will carry on, and domestic demand will continue to take a larger role.
“India, which has been implanting a lot of structural reforms, had a couple of reforms on demonetisation which were a little like teething problems, but we expect growth to go up to 7.4 per cent in 2018, so South Asia as a result will be the highest growing sub-region of developing Asia.”
Unfortunately, the Pacific does not share Asia’s rosy economic outlook.
“The Pacific is, unfortunately, doing not that well because of the challenges it faces,” says Ananya. “Growth has gone down to its lowest level, in 2017, since the 2008/2009 crisis.”
One issue which is playing a particularly big role in Pacific economies is climate change, she added.
“We in the ADB encourage our partner economies to work on climate resilience, which is one of the major factors which affects growth and makes it very volatile. It’s only April and we’ve already had two major disasters in the region.”
As well as making economic predictions for the Asia-Pacific, the Asian Development Outlook also examines a big picture theme for the region as a whole. This year’s theme is ‘the impact of technology on jobs’.
“There’s this idea of technology anxiety, because this new 4th industrial revolution is changing things,” says Valerie. “It’s happened before, with the other revolutions, but now it’s just so much faster, you’re not even getting a chance to react.”
Although technological change is undoubtedly a cause for concern, there are several important reasons to remain optimistic about developing Asia’s growth prospect, she added.
“The really big benefit comes from the fact that goods are now being produced cheaper and better, and therefore that brings income to the people that work there. Also as the result of this new demand that has been created, and most of the demand is coming from within developing Asia, this has created a massive amount of jobs.”
Yet as technology leads to the creation of new jobs, there’s a real need to change the way we think about education and training.
“Training and vocational education is going to have to happen more on the job, for the specifics of those jobs, knowing that some of those jobs won’t last very long,” says Valerie.
“Throughout your career, you may be working on a specific issue, but you also have to be good at learning quickly, and being flexible, and then you can move onto the next job. Lifelong learning will be important.”
Valerie Mercer-Blackman and Ananya Basu were in conversation with Martyn Pearce and Sharon Bessell. This episode of the pod was produced and written by Martyn Peace and edited by Tess Harwood. This blog post was written by Nicky Lovegrove.