EAST ASIA TURNS TOWARDS SOCIAL WELL-BEING

by Marcell Horváth – Eszter Boros

Over the past decades, East Asia has become known for its “Little Tigers”, or rapid economic growth. Most recently, the impact of the Covid-19 crisis has highlighted Asia’s further potential for prosperity, and even the widespread expansion of prosperity, and with the new social policies in China, Korea, Japan and elsewhere, the whole world stands to gain as consumer markets can expand spectacularly.

In 2021, on the 100th anniversary of the founding of the Communist Party of China (CPC), it was announced that the historic task of eradicating deprivation and achieving a “moderately prosperous society” had been accomplished, with an additional 100 million Chinese people lifted out of extreme poverty in the final phase.

This milestone opened a new chapter in Chinese social policy. Shared prosperity is a step up, as it focuses on the highest quality of life (well-being) in the widest scale. Promoting general wellbeing can also help China achieve one of its long-standing goals: to boost consumption.

In 2021, Japanese Prime Minister Fumio Kishida announced a “new capitalism” that would transform the way the market economy works through the quartet of innovation, digitalisation, green transition and resilience.

China to boost spending in 2023 economic revival drive

China’s top economic planner aims to help boost domestic consumption and woo more foreign investors this year as it seeks to revive the country’s Covid-hit economy.

In a People’s Daily interview, Zhao Chenxin, deputy chairman of the National Development and Reform Commission (NDRC), said authorities would align fiscal, monetary, industrial, technology and social policies to promote growth. The government would also give support to previously tightly regulated sectors such as property and internet companies as part of a wider push to increase consumer spending.

Other major players in the East Asian region, such as South Korea and Singapore, are also pursuing a “new capitalism”. One way or another, these countries will have to cope with the (partial) depletion of the growth models they have had so far, and they seem to have the necessary adaptability for this.

Marcell Horváth - The author is the Executive Director for International Relations of the Magyar Nemzeti Bank, Hungary’s central bank Eszter Boros – The author is an expert in the International Relations Directorate of the Magyar Nemzeti Bank