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As the 10 ASEAN member states continue
their push toward a more cohesive ASEAN community, much of the focus has
been on what more needs to be done by each nation in the countdown to an
ASEAN Economic Community (AEC) prior to 2015.
Adopted and signed by ASEAN leaders in November 2007 in Singapore, during
their annual summit meeting, the “Blueprint” for economic integration
under the AEC envisioned “a single market and production base” and a
Southeast Asian region that would be “highly competitive,” characterized
by “equitable economic development” and “fully integrated into the global
economy”.
But perhaps lost in all the debate over what the AEC might mean in terms
of freer — if not free — trade in goods and services, skilled labor,
investment and capital flows are the implications for Southeast Asia if
the gap between the rich and the poor grew and grew, and no one noticed.
Equitable development under the AEC does not and should not, after all,
necessarily mean equitable results. It should mean equitable
opportunity.
Under Presidents Barack Obama and George W. Bush, I served as US
ambassador to the Asian Development Bank, an institution focused on
reducing poverty in the Asia and Pacific region’s least developed nations
in part through finance a range of infrastructure projects and programs,
as well as efforts to foster greater regional economic integration.
Critically, Southeast Asia’s leaders must also focus on inequality of
opportunity if development is to be sustainable. More equal access to
public services, such as education, water, electricity and sanitation,
should be critical concerns.
Now based in Thailand at a regional institute focused in part on educating
a next generation of future government, civil society and business
leaders, including hundreds of students from the ASEAN region, I am often
struck by the contrasts between the images governments might seek to
project and the realities on the ground. Also striking are people’s own
images of the countries in which they live.
While delivering a guest lecture at Chulalangkorn University’s Sasin
Graduate Institute of business administration, I asked, “Which nation in
Asia is the most ‘unequal’ when it comes to the Gini coefficient, or
index — a measure of income inequality?”
Pakistan, India and Vietnam were among the responses. Imagine the
surprise, when I informed them of the CIA World Factbook’s rankings:
While the African nations of Namibia, South Africa and Lesotho top the
charts as the most unequal in the world, Thailand is ranked as the most
unequal in Asia. Coming in as the 12th most unequal worldwide,
Thailand is followed in Asia by No. 13 Hong Kong and No. 19 Papua New
Guinea. Sweden has the most equal distribution of average family
income of more than 130 ranked nations and territories.
For the Southeast Asia nations for which data is available, the rankings
in order of most unequal to least unequal distribution of family income
are: Thailand (12th most unequal); Singapore (29th), Malaysia
(33rd), Philippines (36th), Cambodia (45th), Vietnam (73rd), Indonesia
(78th) and Laos (70th).
Some of these figures are startling. Indeed, the rankings also underscore
one of the fundamental challenges of policy. That is, the accuracy of
data. Rankings are only as good as the source data. GIGO, as they
say: Garbage in, garbage
out.
The inconvenient truth is that even as a changing Asia helps drive the
global economy, the region remains home to two-thirds of the world’s
poor, and an estimated 1.7 billion people still struggle on less than
US$2 a day, according to the ADB. Approximately 700 million live on less
than $1 a day.
Ethnic minorities and indigenous peoples are often marginalized and
excluded from the benefits of the region’s growth. Some 43 percent of the
Asia-Pacific population do not have access to improved sanitation
facilities, and growing numbers moving to Asia’s teeming cities face deteriorating
sanitation and environmental conditions and inadequate housing and
infrastructure, according to the ADB.
So, does the “official” Gini index really matter to ASEAN?
In some ways, it remains a philosophical question for Southeast Asia —
about the role of government, business and civil society, and about what
level of inequality a society can accept.
A nation can be made up of equally poor people and would fare much better
in the Gini rankings. Perhaps more important than official Gini coefficients
are trends and attitudes as to whether or not things are getting better
and for whom.
Respected Singapore diplomat Tommy Koh once wrote that technology,
globalization and domestic policy are the key drivers of inequality
today. In discussing Singapore’s relatively high Gini coefficient, Koh
wrote that the number did not capture some of Singapore’s strengths: a
strong rule of law, a non-corrupt government and most importantly,
equality of opportunities and social mobility.
There is indeed more to a nation than its Gini coefficient.
Certainly, Southeast Asia — like much of Asia and the Pacific — has been
transformed these last decades. Poverty has decreased and tens of
millions live better lives. And people everywhere should welcome an Asia
that is both more prosperous and more at peace with itself.
With the twin jinni’s of technological progress and globalization out of
the bottle, there is no putting them back in.
As Southeast Asia moves toward greater economic integration and
cooperation, how its leaders, businesses and everyday citizens answer the
question, “What if the gap between the rich and the poor grew and grew,
and no one noticed?” will help define what kind of community the AEC will
truly be. ●
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