}
It is observed that governments of Asia Pacific have been and will be investing
heavily to improve the economies' physical infrastructure (Table 8). This mainly referred
to the development of transportation and telecommunications networks.
Physical infrastructure is the prerequisite for greater regional cooperation and
interdependence. In order to allow Asia Pacific to function as an integrated entity, it is
necessary to have a transportation and telecommunication network which links up
countries within the region and the region with the world. The network should ensure
that information be transmitted and goods and services be transported with speed,
safety, economy, sureness and convenience. In the short and intermediate run, these
infrastructural project will help to sustain the economic growth of Asian economies
against short-term economic shocks, such as recessions in the western countries.
On top of physical infrastructure, the governments have also been putting emphasis
on the development of institutional infrastructure such as patent and franchise law and
other legal issues which protect human and property rights in economic transactions.
F.
Economic Adjustment in Japan and the ANIES
In the 1980s, Japan and the ANIES have been facing economic adjustment problems
such as trade frictions with the western industrialized countries, currency appreciations
and labour shortages. Since the latter half of the 1980s, over 50% of the U.S.A. 'strade
deficit stemmed from U.S.-Asia trade. Consequently, protectionism has been increasing
and taking new forms. A fortress Europe in 1992 would generate further adjustment
problems for the export sectors of these economies. Since Taiwan and Hong Kong are
developing close economic ties with China, current U.S.-China trade frictions are
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