After half a century of success, the Asian tigers must reinvent themselves
THE FOUR Asian tigers—Hong Kong, Singapore, South Korea and Taiwan—once fascinated the economic world. From the early 1960s until the 1990s, they regularly achieved double-digit growth. A generation that had toiled as farmers and labourers watched their grandchildren become some of the most educated people on the planet. The tigers started by making cotton shirts, plastic flowers and black wigs. Before long, they were producing memory chips, laptops and equity derivatives. In the process they also spawned a boisterous academic debate about the source of their success. Some attributed it to the anvil of government direction; others to the furnace of competitive markets.
Then the world turned away. The Asian financial crisis destroyed their mystique. China became the new development star, even if, to a certain extent, it followed their lead. The tigers themselves seemed to lose their stride. This year America is on track to grow more quickly than all four of them.
They all have seemingly intractable problems: stagnant wages in Taiwan, the dominance of big business in South Korea, an underclass of cheap imported workers in Singapore and, most explosive, a government in Hong Kong that will not, or cannot, listen to its people.
But it is a mistake to write off the tigers. A closer look at their economic record shows...