USM, PENANG, 11 May 2016 – A digital economy can be an important tool to tackle the harmful challenges that would affect the rise of the world economy, particular in Asia, as highlighted by Dr. Keiichiro Oizumi, a Senior Economist from the Japan Research Institute during his public lecture, entitled "Mega Trends in East Asia - What is Happening? What’ll Happen?" here recently.

Dr. Oizumi stated, “Is it Shanghai or China? Is it Tokyo or Japan? Or is it Kuala Lumpur or Malaysia? More often than not, we would only evaluate one facet without considering that each different metropolis does not merely have a large population, but the economy level is also probably significantly higher than the rest of the country, and as a result, it did not reflect the real conditions of the country as a whole.”

"Malaysia per capita GDP is above $10,000 but Kuala Lumpur is above $20,000. That is why Japanese businessmen concluded that Malaysia is a developed nation when they visited Kuala Lumpur.

"The same goes for Thailand, with the per capita in Bangkok being above $10,000, however, there is still a number of regions where the per capita GDP is lower than $3000," he added when speaking about the 3 trends that ought to be considered in order to make the 21^st century an Asian Century.

He explained further, the economic index (per capita GDP) of a nation should be considered for its effectiveness in understanding these regions, as it does not represent the rural areas precisely.

He also pointed out the second viewpoint, which is demographic transition. There has been a decrease in the birth rates in Malaysia and in other Asian countries, as these countries didn’t achieve the standard fertility rate of more than 2.1, due to the expensive education costs. Thus, it has led to a rise in an ageing population.

However, high birth rates may result in poverty as people might have low financial savings and investments. Instead, low birth rate is believed to be able to raise the proportion of productive age population, with those in society whom are able to go to work, which is known as a demographic bonus. Unfortunately, the exact duration of a demographic bonus is still unknown.

"Digital revolution narrowed the information gap between developed and developing countries and contributed to the economic growth, however, it would also bring problems in return," said Dr. Oizumi.

In order to turn the 21^st century into the Asian Century, issues such as the middle income cliffs where the nations with populations that would encounter ageing before they achieve prosperity, the widening gap between mega-cities and the rest of the region, need to be tackled.

For the Asian Century to become a reality, he focused on the digital tools as important components for economic growth.  Knowledge dissemination could be done more easily throughout the country, as the usage of the tools has increased if compared to the last 2-3 years.

"According to a World Bank report, even a household without access to clean water has a mobile phone, and we learn about things with a fair degree of accuracy," he stated.

He believed that economic growth can be experienced by people even without being in a mega-region, and this is an ongoing process that would be led by the younger generation. 

"The Asian Century rests on your shoulders, we are counting on you," he remarked in concluding his lecture.

A graduate of Kyoto University, he received his Master’s degree in Agricultural Science and Ph.D in Area Studies. Mr Keiichiro Oizumi is a member of the Japan International Cooperation Agency (JICA) and also a member of the Japan Association for Asian Studies and the Japanese Society for Thai Studies. His areas of expertise include demographic change and economic growth, and socioeconomic issues on the urbanization in surrounding Asia.

Text: Elezise Oh Ming Han (USM Internship student)