Asia’s Growth Hinges on Innovation and Collaboration
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Tokyo, 27 November 2024: The Asian Development Bank Institute (ADBI) hosted a conference that brought together experts to spotlight the critical need for innovation and regional collaboration in navigating Asia’s economic challenges in the digital age.
A key discussion, centred on a paper by Professor Kaushik Basu from Cornell University, examined the impact of technological advancements on labour markets and the broader economy. ERIA’s Senior Economist, Dr Lili Yan Ing, delivered commentary on Prof. Basu’s paper. The session was chaired by Dil Rahut, Vice-Chair of Research at ADBI, and featured Professor Ayako Obashi from Keio University as a discussant.
Dr Ing emphasised Asia’s impressive economic progress despite ongoing political and social fragmentation. ‘The rapid advancements in technology are creating new markets and products, but they are also reducing the demand for traditional labour. This dual-edged transformation demands innovative economic policies,’ she explained.
According to her, the rise of digital technologies and artificial intelligence (AI) is reshaping the labour market, compelling policymakers to address these disruptions while leveraging emerging opportunities. She also highlighted that regional cohesion remains critical to navigating this complex economic landscape.
Delving into the structural challenges facing Asia, Dr Ing identified two pivotal drivers: the declining demand for traditional labour due to technological disruptions and the proliferation of global value chains (GVCs). These factors necessitate a shift from labour-intensive to creativity- and innovation-driven growth.
Dr Ing also highlighted the importance of collaboration amongst Asian nations, particularly between China and India, in fostering sustainable development. While praising Prof. Basu’s analytical framework, Dr Ing suggested areas where the study could be expanded to offer more practical solutions. She noted for more robust engagement with counterarguments and the inclusion of empirical evidence to illustrate the impact of technological shifts on labour markets across Asia.
Dr Ing recommended tailored policy interventions at plurilateral, regional, and national levels. She also called for an increased focus on upskilling and reskilling programmes to boost productivity in an era of AI and robotics. ‘Critical thinking, data literacy, and basic programming skills are no longer optional – they are essential,’ she said. She also called for policies to address AI governance, cybersecurity, and workforce reskilling to prepare economies for the challenges ahead.
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