Can Partisan Upheaval Sustain Asia’s Growth Model?

Tim Ferguson 

Can Partisan Upheaval Sustain Asia’s Growth Model?

This story appears in the February 2015 issue of Forbes Asia.

If Asia has evolved a superior alternative to contentious democratic government, you might be fooled by recent outbreaks of popular will. The latest came in early January in Sri Lanka, where the strongman Mahinda Rajapaksa and his Chinese patrons were surprised in a snap (and presumed sure) election by an opposition fronted by one of his ex-ministers, Maithripala Sirisena.

The victory may be seen hopefully as not just a rejection of Rajapaksa’s crony-led (and China-financed) growth push but as an affirmation of civil rights neglected by the rejected regime. Thus in Colombo we witnessed the very thing that supposedly Asians had overcome: bumpy dissent impeding the thundering wheels of progress. (But also, to Rajapaksa’s credit, a quick transition.)

Maithripala Sirisena (AP Photo/Eranga Jayawardena)

We don’t know where Sirisena actually will go with his stunning win. There was some backtracking on the China divorce, for example. His camp says encouraging words about a freer economy (here’s an interview with his premier, behind a Wall Street Journal paywall), but the political culture is rooted in centralized power. Likewise, there’s uncertainty in the other transformational electoral results of recent months, in Indonesia and India. President Joko Widodo took power in Jakarta pitted against a majority in parliament and swiftly moved reforms, including an end to fuel subsidies. But despite a personal image as being free of graft, he’s since become mired in his own party’s tawdry legacy when making key appointments. Meantime, Narendra Modicarries the hopes of millions of enterprising Indians at home and abroad, but his changes have been procedural, and some in his party put Hinduism first and foremost.

So there is unlikely to be definitive evidence to refute the democracy doubters with powerful economic growth. South Korea has had spirited political contests for 27 years now, and despite those freedoms (some say speech has been curbedof late) and lots of investment in “human capital,” it still lacks for entrepreneurial oxygen apart from a few notable exceptions. Japan? Well… Recovery there lags behind the big political turn.  On whose shoulders should blame for sputtering Thailandbe placed, the current coup government or the elected bunch that preceded it?

All the while, the democratic–sometimes chaotically so–Philippines continues to sport Asia-Pacific’s most surprisingeconomic growth numbers, at 6.9%.

The contrariwise case has long been China, with its amazing expansion. Who needs free partisan speech when a huge middle class can finally emerge to enjoy the more material fruits of life? Now, as even the estimable Chinese output engine slows, Xi Jinping has positioned himself as the country’s most unchallengeable autocrat since Mao. We can all continue to keep score on the results–in GDPs, yes, and also in the rest of what amounts to human satisfaction.