National Consciousness of some Asian countries on their road towards global integration

Read the attached article National Consciousness of some Asian countries on their road towards global integration

For the second half of the 20th century, a simple pattern drove global growth: raw materials from the developing world were manufactured to provide consumption goods for richer countries. The locus of much of this manufacturing shifted, from the developed world itself to many locations in the developing world; but the basic pattern remained the same. Services in the developed world also expanded, taking up the space left as manufacturing jobs moved out.

Those countries that tried to work against this trend - such as Latin American countries that tried to manufacture mainly for their own developing economies (known as 'import substitution), or Asian developing countries that overinvested in leisure and service and commercial construction - suffered for it. The trend was overwhelming.

Yet it could not last forever. As the capacity of the developing world to produce goods and services grew, the developing world, especially the US, could not continue to purchase it all. It was an effort to prolong this pattern, with Chinese savings being lent to American consumers to buy products manufactured in China and in other developing nations that led to the excess borrowing and speculation that underlay the current global crisis. When the bubble of borrowing burst, the sudden halt in American credit and spending devastated not only developing-world producers, but also all the other elements in the global chain of production, including the suppliers of intermediate manufacturing and construction machinery (Germany and Japan) and of raw materials (Russia), and the suppliers of finance for production and trade (many US and international banks) as well as consumer finance.

What the current crisis does signal is a shift in the future center of global consumption growth. To sustain global growth, the pattern of the last fifty years now must change - global natural resources and manufacturing will no longer go mainly to fuel consumption in rich countries, but to meet the growing demands for consumption gains in developing countries.

The inevitability of this can be seen in the following charts. From 1950 to 2000, the proportion of global population in Europe and the US has been shrinking; it will shrink even further in the next 50 years. But even more striking is the decline in the proportion of the global economy (GDP) produced ...