Part of the change in the ordering of the world economy noted (above) by the Australian ANZ banking group, is the enormous extention in Asian middle classes.
Australian Prime Minister Tony Abbott, in a speech to the Australian Asia Society, congratulated China on wha the called a 'remarkable achievement.'
But China, although certainly having had the largest increase in their middle class, is not alone. From Indonesia to India, the rising middle classes are driving Asia's coming financial dominance.
April 2, 2014 1:00 pm JST
Asia's economic rise changing world order
Shoppers do their thing in Jakarta: Indonesia's high birthrate means the country's middle class will continue to swell.
BANGKOK -- Asia's increasing economic clout -- backed by population growth and a burgeoning middle class -- is forcing changes to the Western-led global corporate order.
Late last year, the mayor of a city in suburban Belgrade, Serbia, gave an enthusiastic welcome to a delegation from Indonesia, thanking the Salim group for deciding to build an instant-noodle plant there.
The plant is for the Indomie brand of noodles, which are made by a company belonging to Salim, the Southeast Asian country's biggest conglomerate. The brand is synonymous with instant noodles in the Middle East and Africa, where it is the market leader.
Europe and Asia have been duking it out for supremacy on the Balkan Peninsula, home to Serbia. Salim is hoping the noodle plant will boost its business in Europe. It will also help create jobs in a country struggling with an unemployment rate of more than 20% and a shrinking economy.
Salim's decision reflects Indonesia's solid 6% economic growth and symbolizes the country's increasingly robust presence in a Europe that is running short of breath.
Age of two oceans
Europe is not the only market where Indonesian companies are strutting their stuff. For example, Kalbe Farma, Indonesia's largest pharmaceutical company, has begun producing over-the-counter drugs in Lagos, Nigeria's biggest city, with an eye toward expanding sales in South Africa and Zimbabwe.
This overseas push comes against the backdrop of a fast-growing Indonesian middle class and forecasts that the country's overall population will swell to 300 million in the 2030s from the current 240 million. Companies that have grown by capitalizing on the increase in middle-income consumers are venturing beyond the region to tap new markets.
Akihiko Tanaka, president of the Japan International Cooperation Agency, said the first quarter of the 21st century is moving toward the "age of two oceans" -- the Pacific and the Indian Ocean, the latter of which encompasses high-growth countries stretching from Southeast Asia to India to Africa.
Highlighting the tremendous growth occurring in this region is the plan by Philippine retailer SM group to add 25 new shopping malls over the next five years to its retail chain, which in the past three decades has grown into the country's biggest. This means the company will, essentially in a single stroke, boost its network by 50%.
Middle-class boom
A key feature of the region stretching from Southeast Asia to Africa is the sheer number of young people. Indonesia has 72 million people age 14 or younger, more than the entire population of Thailand. The average ages of the populations of the Philippines and India are in the 20s due to continuous population growth, far younger than Japan's late-40s and China's late-30s.
In areas where populations are ballooning, the middle-class will swell when children there come of age. The world's middle-income population will jump to 4.8 billion in 2030 from 1.8 billion in 2009, with Asians accounting for 89% of the increase, according to the Organization for Economic Cooperation and Development. Also, over 60% of those in the middle-income bracket will be in Asia, up from 20%, while the combined ratio for the U.S. and Europe will be 20%.
Asian products and services are everywhere these days. Take, for example, the 40-year-old high-school teacher in suburban Los Angeles who regularly uses the South Korean-developed KakaoTalk chat app because of its popularity with his friends and students. Information technology-related products developed in North America have become global standards, but mobile messaging apps made in Asia, including Japan's Line, compete evenly with those created in the U.S.
Also, Western corporate powerhouses are setting up new bases in Asia to better cater to markets in the region. Procter & Gamble, a U.S. multinational consumer goods company, has opened a research and development center in Singapore. Nestle, the Swiss food and beverage giant, has established a new R&D center in India and increased the number of such facilities in China to four.
There is little doubt that Asian standards will soon become global standards.
(Nikkei) _ a Japanese Journal
Reference: http://asia.nikkei.com/Business/Trends/Asia-s-economic-rise-changing-world-order
