The 2008 Global Crisis and the East Asian Developmental States Shifts of Export-Driven Strategies

Abstract

AbstractThe 2008 crisis affected all regions across the globe. East Asia appeared one of the regions best positioned to overcome its impact because of the resilience of strong developmental states. The crisis has raised the question of whether the East Asian economic growth model is too dependent on high export performance. The sharp decline of private consumption in the OECD economies in 2008–2009 has affected continued economic success in East Asia. Now the challenge for East Asian developmental states is to search for a new economic strategy moving away from extreme dependence on exports.This imperative was first acknowledged by China, which has initiated an ambitious support package to stimulate domestic demand and private consumption, relying less exclusively on global foreign markets. Thus China has provided new and more accessible markets to its ASEAN neighbours, with the potential to substitute declining import capacity in Europe, Japan and the USA.A structural consequence of the global crisis indicates an acceleration in the rise of East Asia's economic integration. However, this new facilitation of export benefits for the ASEAN countries may delay or hinder long-term needed reforms to raise domestic living standards and wealth redistribution across Southeast Asia.