From factory floor to the middle class

From India to Vietnam and Myanmar, Asian leaders are tying their economic ambitions to manufacturing-led growth. But will the emphasis on industrial expansion provide pathways to economic mobility and lead Asian workers into the middle class?

This is the question that the International Development Research Centre and the JustJobs Network sought to answer in their official seminar at the 48th annual ADB meetings. The conversation, which engaged top experts from government, business, and civil society, examined the impact of policies aimed at incentivizing employment-intensive manufacturing as a growth and job creation strategy. Anindya Chatterjee, IDRC’s Regional Director for Asia, offered opening remarks, and Andrew North, former BBC South Asia correspondent, moderated the discussion.

Panelists discussed the issue of developing allied industries and establishing countries within global value chains. Rafaelita Aldaba, Assistant Secretary for Industry Development in the Philippines, noted that despite early gains in the automotive and business process outsourcing sectors, jobless growth remains a concern. The Philippines now sees investments in skills training as a way to make higher value-added products.

Zaw Oo, Economic Advisor to Myanmar President Thein Sein, offered insights on the challenge of avoiding the “resource curse” in frontier markets. He noted that Myanmar is seeking to learn from the experience of other Asian economies by promoting investments in human capital alongside investment in natural resource industries. JustJobs Network Executive Director Sabina Dewan also emphasized the importance of skill development to ensure greater productivity and higher wages.

Martin Rama, Chief Economist for South Asia at the World Bank, pointed out that the success of Asian countries in uplifting large sections of their populations from poverty would depend on well-managed urbanization and infrastructure development. He remarked that this is a “moment of opportunity” for South and Southeast Asian countries to leverage their speed of change and fill in behind richer nations in a “flying geese” pattern. According to Ms. Dewan, this can be achieved if countries diversify their manufacturing sectors by moving beyond low-value-added industries like garments.

Another solution, offered by Selima Ahmad, Founder of the Bangladesh Women Chamber of Commerce, was to involve more Asian women in entrepreneurship and decision-making, despite cultural limitations. She remarked that women need to have ownership over their employment and that engaging women in the workforce will lead to better economic outcomes.