Surviving in the Asian Century

by Dian Amalia

Asia is changing the world. Australia realizes this and is therefore trying to dive into the opportunity by creating a roadmap to guide Australia in engaging Asian countries with what is called “Australia in the Asian Century White Paper”. The White Paper is a strategic framework for the next 13 years to seize upon Asia’s rapid ascent as a global economic powerhouse. It also sets out a series of actions that will be taken over the next five years and further.

The Asian Century premise in not something new. It appeared in the 1980s as China and India stole world’s attention by developing robust economies. The 19th century belonged to the British, known as the British Century, the 20th belonged to the United States, known as American Century, while this century, as said before, is for Asians. It is true that not all Asian countries have the same power in economic performance, but large economies like China, Japan, India, South Korea, Indonesia and Singapore, will surely have a big economic impact. This is not to mention, Kazakhstan, Thailand, Turkey and many more emerging nations which have a positive impact on the global economy.

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Picture taken from http://resources3.news.com.au/images/2012/10/31/1226504/870579-asian-century-white-paper.jpg

The policy sets out 25 objectives for Australia to be prepared for the Asian boom by 2025 that includes five key areas: the economy, education, commerce, regional security and culture.

Australia has targets under the white paper, including raising productivity in order to raise their GDP from 13th highest in the world in 2011 to the top 10 by 2025. This will mean Australia’s average real national income will be about 73,000 per person in 2025 compared with $62,000 in 2012.

In education, schools in Australia will give their students access to one priority Asian language: Mandarin, Hindi, Indonesian or Japanese. They want to make sure that the students have a stronger background in Asian topics. Through this effort, they are hoping that by 2025, Australian education will be in the top five in the world.

Some questions arise from the aggressiveness of Australia’s policies: Does Asia really have that huge an impact on Australia?  Will this program work? Furthermore, will it disadvantage their relations with the west?

To answer the first question, I believe there is no more doubt that Asia is in a golden age where the economy is rapidly increasing. Based on ADB analysis, this economic achievement was led by Japan and produced dramatic spurts of growth in the rest of Asia, mostly East Asia. Whether Asia will still be strong in the future years is debatable and will be a challenge for Asia.

Geographically, Australia has deep connection with Asian countries, mostly with ASEAN. Located in the south edge of Indonesia, Australia had built important cooperation in both government and non-government agreements with Asia including in trading, migration and education. Through the program, Australia will create more chances for enhancing the agreement. As Asia is the home to the majority of the world’s middle class and will also be the largest producer and consumer of goods and services, Australia will stimulate the demand. Although Australia has benefitted from Asia’s growing appetite for raw materials and energy from countries like Japan and China, it will construct a similar pattern with other Asian countries.

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Picture taken from http://unitingworld.org.au/blogs/files/2012/04/Australia_and_asia.gif

In a cultural aspect, Australia has Western origins and alignments that may taint its image in Asia. Even though Asian language will be compulsory in their education system, this will not tackle the problem of social capital, especially because Asia is still well-known for its rich culture and conservatism.

Looking back at the global financial crisis and the current euro debt crisis, Australia was pretty safe and its economy was impacted very little, even though it has tight relations with United States and Europe countries. In this circumstance, they were saved by their connection with Asia. For example, China saved Australia from the deep recession because of its high demands on minerals. On the other hand, Australia’s relation with western countries also saved them from Asian crisis.

Through this program, Australia might have to sacrifice their position towards the west, especially the United States. In the recent presidential campaign, Obama mentioned in one of the debates that he will keep a tight watch on China’s devaluation of currency to secure jobs for employment in US and to protect the trading agreements. While giving China a hard time, the US will loosen up for ASEAN and West Asia by enhancing bilateral and multilateral settlements.

I agree that the White Paper is a good program for Australia’s foreign policy because Asia and Australia will both benefit. It may be a little late, but since I believe Asia still has a long, bright future, Australia will not be left behind. I also agree that this will no longer balance Australia’s tie with US.

The concern that I have is about the preparation of Asia to accept Australia. By narrowing it down to China, India, Japan and Indonesia, this program is like a deal in trade agreements, these countries have to make specific regulations for Australia. Indonesia, for instance, has been preparing for ASEAN Free Trade Agreements (AFTA) for years now, and it is still debatable that Indonesia is ready to compete with their goods and services within ASEAN countries. The program that Australia provides is either a chance or a threat to Indonesia because if Australians speak Indonesian it means more competition among employments.

Asia has already done a terrific job in increasing their economic performance, but they have more chances to grow especially that now Australia is giving the green light to develop deeper ties. Asia should take this as a challenge and start building their strategy to not let Australia take the lead, but instead Asia. Besides, it is the Asian Century, not Australian,

http://asiancentury.dpmc.gov.au/

http://thediplomat.com/2012/11/04/australias-place-in-the-asian-century/

http://www.abc.net.au/news/2012-10-28/live-coverage-australia-in-the-asian-century/4337812

http://www.cnn.com/2012/10/28/world/asia/australia-gillard-asian-century/index.html

http://www.equatorialist.com/reports/australia-in-the-asian-century-white-paper/

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