Full Report - Subregional Office for East and North-East Asia - escap

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ECONOMIC AND SOCIAL SURVEY OF ASIA AND THE PACIFIC 2013 Figure 1.3. Informal employment as a share of non-agricultural employment in selected developing Asia-Pacific economies, latest available data Nepal India Pakistan Indonesia Philippines Viet Nam Sri Lanka Thailand China Total Female Male 0 20 40 60 80 100 Percentage Sources: International Labour Organization, Statistical Update on Employment in the Informal Economy (Geneva, June 2012) and national statistical offices. Notes: Indonesia includes only Banten and Yogyakarta; Sri Lanka excludes the Northern Province; China covers six urban areas. productivity. The global recession of 2008-2009 has moderated productivity increases considerably in comparison to the pre-crisis trend in a majority of Asia-Pacific economies (see figure 1.4). For example, in Cambodia, annual average productivity growth slowed by a striking 6.5 percentage points from 9.2% during 2002-2007 to 2.7% during 2008-2011. During the same periods, substantial deceleration also took place in the Islamic Republic of Iran (3.2 percentage points), China and Myanmar (2.7 percentage points), Malaysia (2.5 percentage points) and Pakistan (2.2 percentage points). This slowdown is even more worrying given that labour productivity levels in developed economies globally continue to outpace developing Asia-Pacific economies by a wide margin – ranging from five times the level in Figure 1.4. Labour productivity: GDP per person employed in selected Asia-Pacific economies China Myanmar India Sri Lanka Taiwan Province of China Bangladesh Indonesia Viet Nam Hong Kong, China Singapore Cambodia Republic of Korea Philippines Thailand Malaysia New Zealand Japan Australia Islamic Republic of Iran Pakistan -2 0 2 4 6 8 10 12 14 Annual average percentage change Source: International Labour Organization: Key Indicators of the Labour Market, 7 th ed. (Geneva, 2011). 2002-07 2008-11 22
THE STATE OF INCLUSIVE AND SUSTAINABLE DEVELOPMENT IN UNCERTAIN TIMES CHAPTER 1 East Asia to seven times the level in South-East Asia and the Pacific and nine times the level in South Asia. 9 Stronger policy emphasis on skills and human resources development, greater investments that boost productivity in the rural and small and medium-sized enterprises (SMEs) sectors and facilitating greater movement of workers into industry and services, among other measures, would be instrumental. There is growing recognition throughout the region that fostering inclusive and balanced growth requires stronger labour market institutions In addition to improving job quality, there is growing recognition throughout the region that fostering inclusive and balanced growth requires stronger labour market institutions. This includes wage systems that can help ensure that wages grow consistently with productivity increases. Higher wages and household incomes would facilitate the growth of domestic markets and reduce the region’s reliance on low-wage manufacturing exports to drive growth. To this end, minimum wage policies and related wage reforms have taken greater prominence, including, among other economies, Hong Kong China, Malaysia, the Philippines and Viet Nam (ILO, 2012a). ESCAP analysis indicates that a minimum wage policy boosts workers’ income and improves longterm job prospects without adversely affecting businesses provided it is carefully designed along with supportive adjustment measures. For example, it is estimated that recent minimum wage hikes in Thailand would increase employment growth by up to 0.6 of a percentage point by 2015, while real GDP growth would also increase by 0.7 of a percentage point above the level without the minimum wage increase (see box 1.2). Food and fuel price pressures despite slowing headline inflation Headline inflation is down across many economies in the region as demand-side pressures decline in tandem with slowing economic growth (see figure 1.5). Price increases have also moderated in response to monetary policies which were progressively tightened across the region until early 2012 (see figure 1.6) when the balance of concerns between economic growth and rising prices was tilted more towards the latter at a time of relatively robust growth. Since early 2012, however, the reverse increasingly became the case and some governments, such as India, the Philippines, the Republic of Korea and Thailand have loosened monetary policies as one of their policy measures to support domestic economic activity to counteract the repercussions from slowing external sectors. While headline inflation is down across the region, there remains considerable divergence in its level across countries. For countries with relatively high inflation, rising prices are often not due to increased demand or overheating but to supply shocks or rising production costs because of shortages of critical infrastructure. In some cases, rising prices are due to upward adjustment of administered prices or the removal of subsidies. One of the key shortfalls currently for many such economies is the enormous infrastructure gaps that exist between the requirements and actual investment. The availability of energy is the most immediate need for supporting economic activity. An additional complication in the management of price pressures is the high and volatile prices of food and fuel across many economies in the region. It can be seen that movements in consumer price inflation in many economies of the region substantially track movements of global food and fuel prices (see figure 1.5). Global oil prices since the nadir of the global recession in 2009 have increased dramatically in a volatile manner. Driven by geopolitical instabilityrelated supply concerns in the Middle East, prices remain at over $100 a barrel for Brent crude. Of even greater concern is the evolution of food prices in recent months, with the FAO food price index of key commodities increasing to near record levels on the back of weather-related shortages in key producer economies. 23
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DEVELOPMENTAL MACROECONOMICS: THE C
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Turkey Hong Kong, China Tajikistan
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INVESTING IN INCLUSIVE AND SUSTAINA
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Percentage of GDP INVESTING IN INCL
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❚ ❚ ✕❚ INVESTING IN INCLUSI
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207 REFERENCES
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REFERENCES REFERENCES Abdyrasulova
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REFERENCES (2012a). The debate on e
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REFERENCES (2012). World Energy Out
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REFERENCES Ma, K-H (2008). Assessme
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REFERENCES (2011b). Child Poverty i
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REFERENCES United Nations, Economic
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STATISTICAL ANNEX STATISTICAL ANNEX
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STATISTICAL ANNEX Table 2. Poverty
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STATISTICAL ANNEX Table 4. Resource
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STATISTICAL ANNEX Technical notes T
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STATISTICAL ANNEX Source: Barro, Ro
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STATISTICAL ANNEX estimates based o
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This publication may be obtained fr
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READERSHIP SURVEY The Macroeconomic
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Half a decade since the onset of th
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