Azara Blog: Asia is the future

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Date published: 2005/05/07

The Financial Times has a weekend edition and one of the regular sections of that (for the last few years) is a magazine, which is actually one of the better versions of that kind of thing amongst the British newspaper industry. (But the FT in general is miles better.) One of the regular columns is a review of a lecture. This week's column features a lecture by Tom Peters and Richard Scase in London. The article says:

Their gist is this: there is not much we make or do that they (India and China) soon won't for a tenth of the price; those who moaned when call centres disappeared in that direction ain't seen nothing yet; China will have 100 million people in its middle class within five years, so the big research jobs are next. Meanwhile, the US, unlike Europe, has been quick to embed its companies to take advantage of the cheap labour. More than 350,000 of the 500,000 foreign firms now in the People's Republic are US-owned.

Pretty standard stuff, and the US and especially Europe are largely sleep-walking on this. Further:

India, Scase notes, already has more graduates in information and communication technology than the entire population of Britain and is turning them out at the rate of one million a year. "We're producing graduates in media studies, sociology and those sorts of highly relevant, useful activities," he says, ("media" becoming a pointed "meejah" on his lips). The reason? "We have a celebrity culture which is distorting aspirations, distorting the focus from wealth-creating activities."

A bit rich criticising the media culture when he is one beneficiary of this. Media studies is rather ridiculous as a university subject, but, for example, the BBC is highly valued in many parts of the world and, UK Plc should be able to parlay that into some wealth creation, which means more jobs in the media (that English is currently the lingua franca of the world helps). And since the claim is that India is shortly going to wipe us out in IT, why bother training too many people in that. Further:

Peters argues that companies must shift their emphasis from cost-cutting: "The only way to deal with an Indian software designer who's making 10 per cent of what you make is to be more creative and innovative." It's the only edge left, he says. But there is a greater truth we need to understand: "Anglo-Saxon" dominance of economic matters is finished. "The simple fact of the matter is that the 21st century is the Asian century, so get used to it."

Being "more creative and innovative" is relatively trite advice. It would be a bit more convincing if Peters himself actually did something for a living other than just talk about other people doing things. And of course not long ago it was Japan that was going to take over the world, and that never happened. Needless to say Asia has a big advantage in terms of population, but that is also its biggest handicap. There are so many poor people that one can easily imagine large social unrest as the rich get very rich and the poor get left in the mud. This is a smaller problem in Europe and the US although they both have a quasi-permanent underclass (especially the US).

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