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DIGITALIZING ASIA 2020: PART I — Economic Success “The Asian Way”.

In the first of three parts of the series “Digitalizing Asia”, we assess the economic wonders of Emerging Asia and look at the pros and cons of different paths for the people v/s the planet. We question the simple choice to catch up v/s not catching up west, and are intrigued by the third way, the “Asian way”.

The Success of Emerging Asia — The Economical Perspective

For decades, the public agenda has been preoccupied with the dynamics between developed countries and developing countries, eventually clustered into “advanced markets” (mostly represented by G7, a concoction of countries on three continents) and “emerging markets” (as concoctions of countries in four continents) — where it is a big thing in both the media and the people’s mouth that the latter slowly begin to race the former.

But the more you assess what the world really looks like, you understand that this is pretty much financial constructions of categories — what does “old”, “advanced” and “developing economics” really mean? If you instead take a historical look at the geography and assess where the power has shifted in the world, it is even for a child apparent how it is almost only about Asia in general and Emerging Asia in particular

Of all the social constructions of “emerging markets” and “developing economies”, Asia represent 3/4 of the GDP, while Emerging ASIA (i.e. excluding japan and all developing countries) represent 2/3 of these. As a result Emerging Asia today have a higher share of global GDP (34%) than Europe (20%) or even America (23%).

And this is true however you cut it — rewind, play or fast forward — and impossible to avoid:

Asia in general, and Emerging Asia in particular, are taking over as the centre of global gravity.

If we’re looking ahead the forecast for growth in the world is 3.4%. Without Emerging Asia’s contribution it would be 1.1% — the worst in decades. What we’re facing is a global re-balancing of historical magnitude, where most of us know how the “old” economies of the West have been given a sugar rush by financial stimulants, while the underlying economy still is in fact suffering a serious “middle-age crisis”. The difference is that globally this is today balanced by an Emerging Asia where the fastest growing 7%-club stubbornly keep on growing*, which means that the world ahead will not get a fever every time the US “sneezes”.

Is the circle thus closing? In one version of this argument the 19th century belonged to UK, the 20th to USA and the 21st now is transferring to Asia. In at least a little less stereotyped version the path goes from the first homo sapiens in Africa to the first civilization in Eufrat and Tigris, moving to the first democracy in Greece, expanding into the empires of the Mediterranean (and, back then, also Asia), moving to the imperialistic journeys and industrial development of all Europe, taking the ship over to the economic and military hegemony of America…

…and then, once again taking the ship over to the economic tigers of east Asia, and now, finally, expanding itself to south and south east Asia to to establish a totally new center of gravity — with all Asia acting as the main centre of the globe with the 21st century becoming “The Asian Century”. Does it sound to “simple” and generalized? So I am told, but when I ask for datadriven arguments I am served very few things that contradicts the thesis:

The über strong Asian performance the last 3–4 decades has proven to not only be sustainable but hold a force and magnitude that will significantly alter the distribution of power on the planet.

The Success of Emerging Asia — The Ecological Perspective

Still, this über strong performance is not coming without a price. One of our guests for this debate is Greta and her millions and billions of Asian friends. Because unfortunately, historically we’ve had a zero sum game between economy and ecology — where The Western world constantly improved its economy at the expense of our ecology. And now we can see it again now — with a strong correlation between per capita CO2 emissions and GDP per capita (while outliers like Sweden and Switzerland proving the joint of two positives still are possible).

The countries with the highest GDP growth in absolute terms, e.g. China and India, are thus also the ones with the highest absolute growth in terms of carbon dioxide emissions (China now biggest in the world, with nearly 1/3 of the worlds’ fossil CO2 emissions — soon even top 10 when looking at per capita numbers). And this doesn’t come without local consequences either, where south Asia is home to some of the world’s most vulnerable countries to climate change. In the past decade alone, nearly 700 million people half of South Asias’ population were affected by one or more climate-related disasters, and since the millennium natural disasters in the region caused damages worth $150 billion.

And it doesn’t stop there. Half of Asia’s population, about 2.4 billion people, live in low-lying coastal areas, which when typhoons intensify due to climate crisis is creating threats to major Asian cities like Jakarta, Manila, Bangkok, Yangon, Saigon and Surabaya. And the surge also have severe impact on food supply, where much of the low-lying deltas in South and Southeast Asia that produce 9/10 of the world’s rice supply, are under risk of disappearing under the sea (in Vietnam, just half a metre rise can endanger most of the Mekong River Delta that cultivates half of the country’s rice supply).

So is the east now on its way to make the same mistake as the west, thinking that the negative correlation between economy and ecology — where doing well for people necessarily has to be at the cost of doing good for the planet — is a deterministic relationship that cannot be changed? Well, if we are, it would be a half-good solution, with totally irreversible consequences for our planet and our children who will be living on it.

Should we thus back down and accept a worse standard of living than the Western world? No, of course not:

In China, 35 years ago 64% of the population in the country lived on $1 a day, while today that same share is 10%.

Thus as the world is currently undergoing an “equalizing” effect where the citizens of the East are on a path to a similar standard to the previous West, no one with morals in place could argue that it is not a “proper” thing to do.

The Success of Emerging Asia — The Western Way

Still, there should be another way. There are APAC forces making strong movement towards renewable energy, and the worst CO2 emitter in the world, China, has invested $361 billion in renewable energy 2016–2020 to meet its key targets by 2030.

But there can be argued that making huge budgets for renewable energy and resilient infrastructure, is still “the old worlds” solutions. We want to keep our cars, so we make them electric. We want to keep our big cities and skyscrapers, so we make them in more resilient and “green” material. Should you be really mean the conclusion would be that this more solves the symptoms than going to the root of the problem.

Cause perhaps this path would be enough to inhibit the effects from the forecasts made ceteris paribus, i.e. what damage the ecological footprints would cause if the region would go on more or less like it does today — but with a dramatically higher prosperity, dramatically more people in school and dramatically more people in jobs, it is a completely different picture we are talking about.

Just imagine what happens when we, among the over 3 billion people living in China, India and Indonesia only, go from having the lowest share of all OECD members+partners in tertiary education for people 55–64 years old. Here we find the latest reportsof 4% in China in 2010 and 7% in India in 2011 and in Indonesia in 2017. Imagine when the share of highly educated people in this region instead becomes over 40%, as it has consistently been in North America for the past ten years.

This would account for a massive intellectual upgrade of over 1 billion people, 1.3 if we extrapolate to all of Emerging Asia — i.e. a total population to be upgraded that is more than the whole population of Europe and North America together. Imagine when this gigantic mass of upgraded people suddenly needs to be transported to schools, need new buildings for attending schools, they need houses built to live in while studying, and must now get all food and other supplies transported to them instead of eating the locally produced food at home in the village.

Exactly, “locally produced food”, for a large part of this upgraded billion of people will be taken from the 43% who today work in agriculture in South Asia (compared to 4% in Europe and 1% in North America), who today eat locally produced food, live in simple, often self-built houses with materials from the immediate area, and without much need for transport.

And this is only the beginning. For what happens for all these young women and men after their studies? When all the upgraded 1 billion upgraded people instead of working offline at home in the village, will get a job, and travel to the cities, transport themselves to work every day, live in all the new houses that must be built, and have all food and other supplies transported to them instead of eating the food produced at home or at least in the village.

And, adding to this, imagine what will happen to consumption when all these people as a result double their salary in ten years time.

And, finally, as the great death knell for mother earth, imagine what industry needs to be built to maintain all this.

With the world biocapacity of 1,6 GHA/person already having been surpassed by a global average of 2,8, one of the global insights at the twilight of this decade, at least by the younger generation, is that something really needs to be done. But it will not. With the above scenario nothing ever initiated by Mara, Apasmara and the Devil will be near what the next generation will experience when the ecologic footprint thus goes from the 1,1 and 1,9 GHA in South Asia and Southeast Asia today, to the level of the western world (4 for Europe or 8 for north America) tomorrow.

We then talk about something completely different. We are not just talking about a complete explosion of fossil CO2 emissions, we are talking about an ecological footprint that is about as healthy for mother earth as the nuclear bomb is for the human body. To then only think, as always, about replacing fossil fuels with renewable energy, and to work on an infrastructure a little more resilient to the climate disasters that will be the consequence, will be a mere drop in the sea.

Instead we have to stop thinking about technological development as something totally deterministic, and instead introduce what the technology scientists call “Interpretative flexibility”, perhaps my major credo in life:

To not use new technology to repair old processes, but to innovate totally new ones.

The Success of Emerging Asia — The Asian Way

So if I was president in any of these fantastic Asian tiger economies, then that’s the question I would ask, and that’s the solution I would make my primary task in life. How could I keep on bringing my people from poverty to prosperity, while still not destroying the planet that me, they and our children are going to live in?

Cause is there really no alternative but to remake the mistakes of the West and drive at full speed until the planet is completely imploded by the ill-treatment we humans make against it? Well, of course there always are, to say something else is just as unimaginative as the doomsday prophets who claim we only have two choices for AI (i.e. either be enslaved by it, or put an end to it — for a slightly different view, see https://lnkd.in/fFcrmrq).

So what can you do? Well, Emerging Asia can prove to be so much better than the west ever has been, that we can be more innovative, more creative, more ethical and…. Yes, more digital 😊

The solution is as simple in theory, as it will require the most giant impressive leader to go from fiction to facts. Because to offset the two forces of exploding economy and imploding ecology against each other, you have to “digitalize Asia” in a totally different way, where you make all efforts possible to decarbonize the economy by substituting the giant move of people to a giant move of information.

Now we are talking about something far beyond the buzz of smart cities. Where you find a sustainable way of embracing the gig economy with remote work — you move information instead of people. Where you upgrade your skills and increase career and performance by studying via the mobile — you move information instead of people. You transport requests for food and clothes which is delivered by electronic drones — you move information instead of people . You take frequent AR-supported video calls instead of physical meetings — you move information instead of people. You take the health test by yourself and send it for diagnosis via your mobile — you move information instead of people. You take romantic dinners, beers with your friends and play with your kids in a VR-world rather than in the real word…

…well, perhaps not, not all transferring of information is as enjoyable as transferring people, we’re not talking Matrix here 😊 But in an extremely broad array of processes we have in west historically become used to moving people where it actually is not to our advantage if we’d look at it tabula rasa. Call it innovation, disruption, revolution, reengineering or whatever you want.

I call it the success of Emerging Asia, the “Asian way”.

And if you can accomplish that, you will not only “succeed” with the Asian prosperity, you will do something much more unique, you will reach “sustainable success” — i.e. whoever succeeds in such a mission will not only rule the world, he will make sure there is a world to rule over.

More on that to come (see Part II here).

Rufus Lidman, Fil. Lic.

Rufus Lidman is one of the worlds’ top 100 tech influencers with 50.000 followers for input with emerging technology within emerging markets. As such he draws his insights from a broad tech experience as a serial entrepreneur with 6 ventures and 2–3 ok exits, background within PhD-studies within change processes, 5 books on the subject of digital strategy, and honoured to be member of the exclusive group of 0,1% ventures that developed apps with more than 10 million downloads. His latest venture is called AIAR, based in Singapore, reinventing learning for emerging markets in general and emerging Asia in particular.

* Which means a doubling of GDP every decade — and, as always, the devil’s really in the details here, where a country that has 7% compared to one that has 5% has twice as high GDP after 30 years, which is exactly what we’ve seen happen in China and several tiger economies in recent decades.

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AIAR EdTech PTE Ltd — Reinventing Global Learning

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Rufus Lidman

Rufus Lidman

Data disruptor with 50,000 followers. 300 lectures, assignments on 4 continents, 6 ventures with 2–3 ok exits, 4 books, 15 million app downloads.

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