Four Asian Tigers

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Four Asian Tigers
A map showing the Four Asian Tigers  Hong Kong  Taiwan  Singapore  South Korea
Chinese name
Traditional Chinese:	亞洲四小龍
Simplified Chinese:	亚洲四小龙
Literal meaning:	Asia's Four Little Dragons
Transliterations Mandarin - Hanyu Pinyin: Yǎzhōu sì xiǎo lóng Yue (Cantonese) - Jyutping: aa3 zau1 sei3 siu2 long4
Korean name
Hangul:	아시아의 네 마리 호랑이

The term Four Asian Tigers or East Asian Tigers refers to the economies of Taiwan, Singapore, Hong Kong, and South Korea. They are also known as Asia's Four Little Dragons. These countries and territories were noted for maintaining high growth rates and rapid industrialization between the early 1960s and 1990s. In the early 21st century, with the original four Tigers at fully developed status, attention has increasingly shifted to other Asian economies which are experiencing rapid economic transformation at the present time.

The four Tigers share a range of characteristics with other Asian economies, such as China and Japan, and pioneered what has come to be seen as a particularly "Asian" approach to economic development. Key differences include initial levels of education and physical access to world markets (in terms of transport infrastructure and access to coasts and navigable rivers, which are essential for cheap shipping).

Contents 1 Characteristics of the Tiger economies 1.1 Role of traditional philosophies 2 Criticism of the export-driven trade model 3 See also 4 References 5 External links

[edit] Characteristics of the Tiger economies

The Four Asian Tigers pursued an export-driven model of economic development; these countries and territories focused on developing goods for export to highly-industrialized nations. Domestic consumption was discouraged through government policies such as high tariffs. The Four Asian Tigers singled out education as a means of improving productivity; these nations focused on improving the education system at all levels; heavy emphasis was placed on ensuring that all children attended elementary education and compulsory high school education. Money was also spent on improving the college and university system.

Since the Four Asian Tigers were relatively poor during the 1960s, these nations had an abundance of cheap labor. Coupled with educational reform, they were able to leverage this combination into a cheap, yet productive workforce. The Four Asian Tigers committed to egalitarianism in the form of land reform, to promote property rights and to ensure that agricultural workers would not become disgruntled. Also, policies of agricultural subsidies and tariffs on agricultural products were implemented as well.

The common characteristics of the Four Asian Tigers are:

• Focused on exports to richer industrialized nations
• Trade surplus with aforementioned countries
• Sustained rate of double-digit growth for decades
• Non-democratic and relatively authoritarian political systems during the early years
• High level of U.S. treasury bond holdings
• High savings rate
• The ranks of GDP (by nominal) List of countries by GDP (nominal) of South Korea, Taiwan, Hong Kong, and Singapore are 12th, 21st, 36th, and 44th as in order.
• A high degree of what is referred to as economic freedom. Hong Kong, Singapore, Taiwan and South Korea are 1st, 2nd, 26th, and 36th respectively on the Heritage Foundation's Index of Economic Freedom published in 2007.

[edit] Role of traditional philosophies

Economic success in Japan, followed by the Four Asian Tigers, has been attributed to the existence of harmonious labor-management relations.( cf. W. Dean Kinzley, "Industrial Harmony in Modern Japan. The Invention of a Tradition", Routledge, London & New York, 1991). “Industrial Harmony” is this unique “Culture of harmony” that was consciously invented and developed over the last century in Japan. A semi-bureaucratic organization called the “Kyochokai” (The Co-operation and Harmony Society) was established in 1819 to meet the needs of an emerging industrial society. The “Kyochokai” took the lead in trying to define the values which would be suitable for a new Japanese-style industrial society, at the time of great social troubles in industrial Europe. The resulting "invented" tradition has played an important role in the evolution and character of Japanese economic values and behavior of social peace for economic development.^[1]

Japanese experience appears to challenge unilinear theories of modernization, and to suggest that Japan’s uniqueness lies in the creation of its own kind of modernity, sharply divergent from that to be found in Western countries, and based paradoxically upon a reaffirmation of ancient Confucian values and native Japanese traditions of harmony, self-sacrifice and non-individualistic group striving in pursuit of a common cause. Japan’s emphasis on long-term growth, scrupulous market evaluation, and process engineering are all well regarded as important components of its economic development.

This is the foundation ("Grund" as it used to be) of "Asian political economy".

[edit] Criticism of the export-driven trade model

The Four Asian Tigers were strongly affected by the 1997 Asian financial crisis, which impacted each Tiger to varying degrees. While Taiwan was not as strongly affected, South Korea was badly battered by the crisis. However, South Korea rose up to become the 9th largest economy in the world (2007 standard) and Taiwan stayed as the 16th largest economy in the world. Because of the focus on export-driven growth, many of the Tigers became caught up in a game of currency devaluation. The current criticism of the Four Asian Tigers is that these economies focus exclusively on export-demand, at the cost of import-demand. Thus, these economies are heavily reliant on the economic health of their targeted export nations. In addition, these nations have met difficulties after they lost their initial competitive edge, cheap productive labour. India and China have now emerged as fast-growing economies based on cheap labour, largely replacing the Tigers.

Some economies were becoming overheated, stock prices were overvalued, property prices were sky-high and investors were jittery and nervous. Because of the structural weaknesses in the regulatory framework, once capital flight began, the stock market nosedived and the major Asian currencies depreciated significantly. This caused social unrest, political instability, regime change and financial bailing out by the International Monetary Fund. This also gave impetus to some Asian governments to impose capital controls to restrict currency outflows and maintain monetary and financial stability. Taiwan created legislation requiring all outgoing capital transfers to be declared. However, there were no direct restrictions.

Since the crisis most of the Tiger economies have become financially stable with resilient institutions and companies and regulatory frameworks in place to prevent another crisis. This has also shown many Asian governments that the easy and predictable prosperity of export-led growth and cheap labour costs won't last forever. To better compete with the emerging manufacturing giants like China and India, they will have to create new industries, move up the value-add chain and create stronger service sectors in their economies.

[edit] See also

• Economy of Hong Kong
• Economy of Taiwan
• Economy of Singapore
• Economy of South Korea
• Asian Century
• Chinese Century
• Sinosphere
• Baltic Tiger
• Celtic Tiger

[edit] References

[edit] External links

• BBC map of the Asian Tigers
• ASEAN tigers
• The Elephant at the Gate in China Economic Review