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Developing Asia must adapt its export-driven model and develop new engines of growth if the region is to sustain the robust economic expansion it has enjoyed in recent decades, says Asian Development Bank (ADB) President Haruhiko Kuroda.

“A growth model which worked well for a low-income, capital-scarce region will not work for a middle-income, capital-abundant region,” says Kuroda said during a seminar at ADB’s 44th Annual Meeting and held jointly with the International Monetary Fund (IMF).

The joint ADB-IMF seminar, “Nurturing New Engines of Growth,” explored a range of strategies for developing Asia to recalibrate its growth strategy.

These include enhancing access to finance and strengthening social safety nets in order to reduce precautionary savings and boost spending; increasing investment in infrastructure – especially by inducing greater private sector participation; removing policy distortions that favor manufacturing and exports to countries outside the region; and enacting policies to stimulate trade within Asia and the Pacific.IMF Deputy Managing Director Naoyuki Shinohara noted that Asia’s extraordinary economic gains in recent decades stemmed largely from manufacturing exports to advanced economies. But the global economic crisis and slow growth in most G7 economies underscore the need for Asia to develop domestic markets and stimulate intra-regional trade.

“Growth in Asia should lead to the creation of enough private sector jobs to absorb the currently unemployed and a fast-growing labor force. It needs to promote equal access to economic opportunity for citizens to realise their potential, and provide social protection for the vulnerable,” says Shinohara.

In addition to Kuroda and Shinohara, other speakers at the seminar were Gerard Lyons, Chief Economist and Group Head, Global Research at Standard Chartered; Changyong Rhee, ADB’s Chief Economist; Anoop Singh, Director in IMF’s Asia and Pacific Department; and Tao Wang, Managing Director and Head of China Economic Research at investment bank UBS AG.

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