TNAG-2597-FCO40-3785-Appointment-of-Chris-Patten-as-new-Governor-of-Hong-Kong--Ap-1992 — Page 26

i

Besides forces which facilitate economic interdependence, we could also identify

forces developing to expedite economic transformation in the region. They stem from

the prevailing economic adjustment to internal and external shocks in the four Asian

newly industrialized economies viz. Hong Kong, Singapore, Taiwan and South Korea

(ANIES), and Japan: Such shocks include trade frictions with the U.S. and the EC,

labour shortages and rising wage rates, and appreciation of their currencies. These

problems have served as a pressing force for economic transformation in these and

other Asian economies.

,

Asia Pacific is rapidly integrating and transforming. Within this environment, the

four ANIES are going to face a lot of new opportunities which enhance economic

development, and at the same time, new challenges. How are they going to adjust to

make the best out of these opportunities and challenges? In future, it is likely that the

ANIES will integrate rapidly into the region. At the same time, they will be transforming

themselves to attain a higher production capacity and a more diversified production

structure. In this paper, we shall discuss the economic prospects of the ANIES in the

context of the underlying forces of change in Asia-Pacific.

II.

THE FORCES OF CHANGE IN ASIA-PACIFIC

A. Intra-Regional Trade

:

Besides the growth of inter-regional trade between Asia and the rest of the world,

growth in intra-regional trade is considered as one of the major impetuses for rapid

economic

growth in the Asian Pacific region since the late 1980s. The growth in

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