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✍️ Evert Mouw
⏱️ 4 min

Stakeholder Capitalism Ch.3: Asia’s turning point is now

In a series of blogpost, I’m reflecting on the book Stakeholder Capitalism, written by Klaus Schwab with Peter Vanham.

In the West, we seem to be in denial. Especially in the “old continent”, Europe, we seem to think we still are the center of the world. The real Middle Kingdom, however, seems to be China. Asia in the East has come back. The oldest civilizations kick-off “the Asian Century” as is illustrated in the book Stakeholder Capitalism in figure 3.3:

They are back.

I’ve been interested in Asian cultures from a young age on. My grandparents and my mother (then very young) lived for a few years in Papua New Guinea; they spoke a few words of Malay. In my late teens, I became interested in a Japanese martial art (Bujinkan) and Chinese books such as the I Ching, the Art of War (Sun Zu), and texts on Taoism. I also read about the 36 stratagems and a philosophy book on Chinese thinkers. These guys already had a civilization while Rome was still a small village. Later, my interests waned, but I did read Robert D. Kaplan’s Monsoon (2010) and a few articles on the rise of China in Foreign Policy. A few texts from India, such as the nice Panchatantra, were also on the menu. I’m glad the authors pay close attention to Asia. It is known that Asians on average score better on IQ tests than Europeans. They also tend to be more introvert, as is described by Susan Cain in Quiet (2012), and do well in math and technology.

This third chapter, The Rise of Asia, is mostly about economics. The incredible growth of Asia is nicely summarized (buy & read the book). The role of the city Shenzhen is given as a colorful example: from small village to a big industrial city, and now a high-tech hub. This was made possible by the use of Special Economic Zones in China. I loved the reference to Wired, a magazine mostly read by technology-minded people. Such references show the author’s genuine interest in new technology. They also name Foxconn, a company I remember from computer motherboards, and Huawei, well known for 5G equipment. In Holland, and also in other Western countries, concerns are raised about the data security when using Huawei hardware for national communications networks.

Not all is going great. While the authors don’t mention sensitive matters such as the 1989 Tiananmen Square protests, they do point out the huge environmental problems that are the result of the fast growth. Many Asian cities don’t have clean air. Also, the growth is unsustainable, for the same reasons that were pointed out in the previous chapter.

Although I was hit by a lot of doubt in that previous chapter, especially concerning the climate narrative, I have to say that this chapter of Asia gave me a good overview of current economic developments in Asia. The ASEAN block seems to do very well in 2021, which surprises me a little since Kaplan had some reservations back in 2010. It must be said that Kaplan already predicted a huge role for Asian countries in the future. He also told on the relationship defense spending, naval ports and sea lanes. Shareholder Capitalism being a book on economics, not much attention is given to the military buildup in Asia. In the future, however, the changing control of sea lanes could also change economic balances.

The authors pay close attention to the role of China in African countries, which indeed fuels growth in Africa. Earlier, Dambisa Moyo wrote in Dead Aid (2009) about the important role China would play for African growth. Shareholder Capitalism confirms the story of Dead Aid.

Two years later, Dambisa Moyo wrote How the West was Lost (2011) (my review in Dutch), citing various reasons of a declining West, such as (1) growing debt, (2) decreasing R&D, (3) a large and growing pubic sector, and (4) multinational corporations becoming more powerful than national governments. In chapter 2 of Shareholder Capitalism, only the first of her arguments (1) was made, while Moyo paid less attention to environmental issues. I have yet to find out if the authors of Shareholder Capitalism will pay attention to the other factors mentioned by Moyo.

The next chapter concerns the growing inequalities and widening divisions in modern societies. Indeed, political cleavages deepen over multiple dimensions. Keep tuned!

If you want to follow my adventure with this book, just follow this weblog or check my twitterfeed or Facebook timeline with the hashtag #wefbookclub or the mention@WEFBookClub for the next few weeks. You might also order the book, and maybe even join the WEF Book Club on Facebook, so you can make this a participatory experience for yourself.

Also check the index page of my review series that I will update as I add blogposts on this subject.

Deze blogpost werd in december 2022 overgezet van WordPress naar een methode gebaseerd op Markdown; het is mogelijk dat hierbij fouten of wijzigingen zijn ontstaan t.o.v. de originele blogpost.