Why you should care
Because in five years, everyone will be talking about these jackrabbit economies.
This is an OZY Special Briefing, an extension of the Presidential Daily Brief. The Special Briefing tells you what you need to know about an important issue, individual or story that is making news. Each one serves up an interesting selection of facts, opinions, images and videos in order to catch you up and vault you ahead.
WHAT TO KNOW
What’s happening? Concerns are mounting that the trade war between Beijing and Washington could hit other Asian economies disproportionately — especially those with large industries that help China manufacture all the exports it may soon have in surplus. But OZY’s research shows that Asia’s new tigers know that diversity is the name of the game. Kazakhstan and the United Arab Emirates (UAE) are trying to wean themselves off their overwhelming dependence on natural resources, while Bangladesh and the Philippines are looking beyond cheap labor as their chief economic asset. And as Vietnam’s economy races along, some of its workers are upgrading skills to avoid being left behind.
Why does it matter? The world may be witnessing a global economic shift, with long-established loyalties and dominance in both foreign policy and the markets increasingly in flux. Nimble emerging economies — those that are prepared and endowed with a dose of luck — may be able to seize the moment. Many of them are based in Asia, the world’s largest economic region. OZY has picked out those that are making the boldest bets at transforming themselves.
HOW TO THINK ABOUT IT
Center of everything. Ranked as one of the world’s least developed countries until recently, Bangladesh is now one of Asia’s steadiest engines of growth, having tripled its GDP in a decade. That means diversifying from its erstwhile dependence on the ready-made garment industry to sectors such as ceramics, leather goods and footwear. Meanwhile, the country’s making good use of its favorable geographic position: India, China, Japan and other nations are investing in Bangladesh as a regional transit hub to get their goods around the continent.
Don’t be crude. Even with the seventh-largest oil reserves in the world, the UAE knows fossil fuels won’t always be king. That’s why it’s investing in renewable energy projects, selling solar panels and developing wind farms in Caribbean nations like Aruba and Barbados. That’ll grant UAE engineers experience in such projects — key training the country needs in order to hit its goal of generating 27 percent of its domestic energy needs from clean energy by 2021, and 75 percent by 2050.
Let’s get creative. While it’s difficult to measure the size of the Philippines’ creative industries — many of its workers are independent or unregistered — the country sees its talented populace as the key to world economic domination. It launched a concerted effort to rebrand creatives, who’ve long been considered underachievers culturally, as the country’s new superstars. If it can fix its bureaucracy, the Philippines might just have a fighting chance of becoming the Paris of Asia.
Private lives. While Vietnam has the fastest-growing economy in Southeast Asia, there is also a 17 percent unemployment rate among university graduates … compared to the national rate of 2 percent. That’s causing many young people to turn away from public universities and opt for studying abroad or private training programs that better prepare them for the workforce by encouraging English-language fluency and creative thinking.
WHAT TO READ
Why Vietnam Could Be Asia’s Biggest Trade War Winner, by Nguyen Dieu Tu Uyen in Bloomberg
“Prime Minister Nguyen Xuan Phuc is taking advantage of trade tensions to boost the nation’s profile as a manufacturing and export powerhouse, selling everything from shoes to smartphones.”
The Path to Economic Development Is Growing More Treacherous, Again, in The Economist
“Most countries languishing on the lower rungs of the development ladder place their hopes in replicating China’s experience.”
WHAT TO WATCH
Hacked: The Bangladesh Bank Heist
“It’s a country on the up, but one that could ill afford to lose more than $80 million of taxpayers’ money.”
Watch on Al Jazeera on YouTube:
Kazakhstan’s Economy Is Not Yet Diversified
“Let’s face it: It’s an economy that still relies on investment … and despite repeated efforts to diversify into non-oil sectors, tradable sectors, that hasn’t yet happened.”
Watch on CNBC on YouTube:
WHAT TO SAY AT THE WATERCOOLER
Mine all mine. Countries like Kazakhstan and Russia have a distinct natural advantage when it comes to setting up cryptocurrency mining operations: They’re freezing. While most mining setups need to use a lot of power to cool overheated computers, says fintech mogul Alexey Sidorov, winters that reach minus 40 degrees Fahrenheit mean “You just open a window and get free cooling.”