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FORESEEABLE PODCAST
FORESEEABLE PODCAST: EXPLAINING THE ASIAN ECONOMIC MIRACLE Nov 11, 2020 • 23 min Featured Faculty: Razeen Sally Visiting Associate Professor, Lee Kuan Yew School of Public Policy
Razeen Sally is Visiting Associate Professor at the Lee Kuan Yew School of Public Policy and Chairman of the Institute of Policy Studies, the main economic-policy think tank in his native Sri Lanka. His research and teaching focuses on global trade policy and Asia in the world economy. He has also written on the history of economic ideas, especially the theory of commercial policy. What do people mean when they say the “Asian economic miracle”? It’s basically the spectacular economic growth that much of Asia has had since the 1950s and its catch-up growth. So we have countries that started dirt poor, some of them destroyed during the war, like Japan and then Korea during the Korean War. And they’ve risen, some of them, as Lee Kuan Yew put it in his memoirs From Third World to First, like Singapore, like South Korea, like Japan, others from dirt poor to somewhat less poor like India and Vietnam more recently. And some of them from dirt poor to middle income countries - China, Malaysia, Thailand - for example. So that’s the Asian economic miracle over a period of, I’d say 50 to 60 years.
Do you think it’s right to call it a miracle or is this something that was bound to happen one way or another? It’s neither a miracle in terms of something that’s just happened out of the blue, it’s not been preordained, not automatic. It has been man-made, so it’s a result of good conditions. And I think I would point to two main enabling conditions. One is that governments in countries that have had this kind of miracle growth as it were, have got the basics right. The World Bank did a big report on the East Asian miracle in 1993, studying the East Asian tigers and their soundbite for it was getting the basics right. What does that mean? Firstly, you need political stability, otherwise nothing beneficial happens. Secondly, you need reasonable fiscal and monetary stability. You need to be open to international trade, so
