FT: Asia needs to re-invent its growth model
The Financial Times has an op-ed today on how the financial crisis and the global downturn has demonstrated the flaws of Asia’s largely export-reliant and neo-mercantilist economic growth model. In short it argues that the artificial suppression of Asian consumers at the expense of ramping up exports and production to increase net exports relied on the expectations of irresponsible credit card holders in America and the West to continue their profligate spending. So when these consumers cut back, Asian exporters similarly cut back their production, leading to a fall in their countries respective GDPs.
Very insightful read.