26 March 2014

Do you want to get ahead in the Asian Century?

According to a number of articles published in the blog, "The Conversation", Australia has a number of challenges in getting ahead in the Asian Century.

Want to get ahead this century? Yuko Kinoshita

Cultural attitudes are crucial for Australia in this Asian Century, because the basis of any relationship is the people behind it, who are driven by values and beliefs. Australia needs people who can face unfamiliar values and practices with a healthy respect and tolerance, not arrogance and fear. And language education, grounded in cultural awareness, has much to offer. It challenges students to think outside their native environment, and to be curious about unfamiliar cultures. In Japanese, respect or appreciation is expressed as an ingrained and important part of communication.

With the economic and social importance of Asia giving more reason than ever for quality language education, it is nevertheless becoming more and more difficult to achieve due to the financial pressures at universities. Language staff are often forced to increase class sizes, reduce face-to-face contact hours, and eliminate continuous assessments — all of which reduce effectiveness.

“Can’t you use modern technologies to deliver the course at a lower cost?” is a popular question from management. While creative uses of these technologies enhance students’ language learning experiences immensely, we cannot rely on them so heavily to develop well-rounded cross-cultural communication competence. Sadly, colleagues in universities around the nation are feeling a constant pressure to cut costs and, in languages at least, this directly compromises the quality of education.

Australia’s great, untapped resource … Chinese investment. James Laurenceson.

Foreign investment from Asia is lagging far behind trade. In 2011, merchandise exports to Asia (ASEAN, China, Hong Kong SAR, India, Korea, Japan, Taiwan) accounted for 76.2% of Australia’s total. Yet in 2010, these countries were only responsible for 21.0% of total foreign investment flowing into Australia. And abstracting from Japan, the share drops to a paltry 6.3%. The Asian share of the stock of foreign investment in Australia is no more impressive at 12.87%, or 6.87% minus Japan. In contrast, the shares of the US and UK stood at 27.94% and 24.02%, respectively.

For all the talk of behemoth Chinese state-owned entities buying up Australian mining and farming assets, the Chinese share of the stock was less than 1%. In 2010, Chinese investment in Australia actually fell to $1.65 billion, down from $7.82 billion a year earlier. The limited scale of Asian investment in Australia is particularly noteworthy given that the region includes some of the world’s most prodigious net capital exporters, namely China and Japan. Asian investment also appears narrowly concentrated in just one industry sector: mining.

A major challenge that policy-makers face is plotting a path to effectively tapping Asian capital markets in order to promote broader-based, higher value-added, and ultimately more sustainable, productive activities. Australia already has a number of basic policy settings right, such as political stability and a strong system of intellectual property right enforcement. According to UNCTAD, Australia is ranked 15th out of nearly 200 countries for its FDI “potential”, but our actual performance in attracting FDI ranked only 72nd.

Looking forward, the big player in terms of investment flows is clearly going to be China. But in light of the recent cases involving Chinese firms of Huawei and Chinalco, Australia’s attitude to foreign investment seems arbitrary and opaque. Until such basic policy positions can be clearly articulated and justified, it will be nigh on impossible to pursue other worthy endeavours, such as positioning Australia to become an offshore trading centre for the Chinese currency, the renminbi.

More than a farm on top of a mine: Australia’s soft power potential in Asia. Richard Pomfret.

Australia must decide how best to use soft power to further its national interests in the Asian Century. Australia has been largely responding to economic needs of Japan, China, Korea and ASEAN countries, and remaining on good terms with all. This balancing act will become more complex as Asian rivalries deepen. Australia does not have the military capability of the USA or European powers, but it is a major trading nation in Asia, with important potential roles beyond acting simply as a farm on top of a mine. It is part of the ASEAN network of trade agreements, and is participating in the TPP negotiations.

But how can Australia engage in the increasingly complex supply chains that characterise “Factory Asia”? Australia has to create an environment in which skilled workers (designers, inventors, marketers) can play a role. The poster children for this approach are Mattel with Barbie Dolls or Apple with iGoods, which are identified as US products, but are manufactured in Asia. Soft power projection can also include political initiatives such as mediation and peacekeeping in trouble spots, or it can take in semi-commercial relations such as education, which includes training future Asian leaders and voters as well as imparting specific skills.

Australia’s advantages as the place for high quality education for Asians include being native speakers of the only pan-Asian language (English), and being acceptable to almost every country as a partner (or place to visit or study). Policy should build on these advantages to maintain a key place in the coming Asian mosaic. The alternative is to be sidelined from the main arena of global economic growth, relying at most on demand for raw material exports.

Australia can lead the fight against Asia’s lifestyle disease epidemic. Stephen Leeder.

With at least half of all deaths in Asia attributable to chronic diseases, Australia must lend a hand. Millions of Asians suffer from chronic illnesses such as heart disease, stroke, cancer, ongoing respiratory disease (like asthma and emphysema) and diabetes. The causes are often due to rising affluence, shifts from traditional to processed diets, decreased physical activity – as people move from rural to city employment and living – and the pervasive, rising influence of tobacco smoke.

In China, around 80% of deaths and considerable disability are now attributable to chronic disease. Around 300 million Chinese men smoke. Around half of China’s smokers have high blood pressure and are missing out on treatment. For a health-care system committed to reform but struggling to come to terms with contemporary expectations of rural and urban populations, this is the stuff of nightmares.

The scene isn’t any happier in India. Around half of all deaths – around five million each year – are now due to chronic illness. Chronic illness accounts for around half of all deaths in Thailand. Efforts to reduce tobacco consumption in Thailand have been successful. But other parts of Asia haven’t done so well in reducing rates of smoking.

So, what can Australia do to improve our neighbours' health? First, we can provide an encouraging example of successful health promotion initiatives, particularly in tobacco control. Likewise, Australia’s approach to the detection and management of patients with elevated blood pressure has paid dividends. This, too, can serve as a model that other nations can study and possibly adopt. The commitment of the current federal government to health prevention is unusual and exemplary.

Second, we should consider reviewing our trade relations with Asia so that our exports, especially for food, don’t compound the disease risk profile of Asian countries. We can learn from the Pacific, where an aggressive trade push allowed multinational food companies and food producers to push their high-fat products to a new market. So, a thoughtful “health ethics” review of our trading relations with Asia may be possible. We should think carefully about the role we can play in helping our Asian neighbours develop effective, relevant health workforces.

Beyond China: Australia and Asia’s northern democracies. Craig Mark.

With all the talk of China, Australia is at risk of ignoring more democratic powers in Asia’s north. Japan and Korea are Australia’s next largest export markets, and unlike China, share Australia’s democratic political values. And the oft-overlooked Mongolia will be of great importance as we enter the Asian century.

The security relationship between Australia and Japan has steadily grown over the past two decades, to the extent that Japan is now Australia’s second-closest security partner, after the United States.

Since moving to democracy in the 1980s, South Korea’s economic growth has been of great importance to Australia, becoming our third largest export market. Migration to Australia has seen the growth of a substantial Korean community. Korean students, working holiday makers and tourists provide a key component of these valuable markets for Australia.

Mongolia has been a democracy since the end of the Cold War, and is presently undergoing its own mining boom. Australian mining companies are already engaging in joint ventures for exploration and in mines already under development. Mongolia has also contributed troops to the US-led multinational deployments in Iraq and Afghanistan, and to UN peacekeeping missions in Kosovo, Sierra Leone, Chad and the Congo.


John West
Executive Director
Asian Century Institute
Tags: asia

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