South Asia's Turn - (South Asia Development Matters) by Gladys Lopez-Acevedo & Denis Medvedev & Vincent Palmade (Paperback)

About the Book

South Asia has a huge need to create more and better jobs for a growing population, especially in the manufacturing industries where it is underperforming as compared to East Asia. The report examines three critical and relatively understudied drivers of competitiveness: economies of agglomeration: firms and workers accrue benefits from locating close together in cities or clusters through urbanization and localization; participation in global value chains: stronger competitive pressures weed out least productive firms while others improve by gaining access to new knowledge and better inputs; firm capabilities: in order to operate close to what would be considered optimum efficiency levels given the prevailing factor prices and thus employ South Asia's abundant labor. The report shows that South Asia has great untapped competitiveness potential. Realizing this potential would require the governments in the region to pursue second generation trade policy reforms for firms to better contribute to and benefit from global value chains (e.g. facilitating imports for exporters), to facilitate the development of industrial clusters in secondary cities (cheaper and less congested than the metros) as well as to deploy policies to improve the capabilities of firms.

Book Synopsis

South Asia is undergoing a rapid economic transformation and has the potential to become the next major middle-income region of the world. More than a million young people are reaching working age every month, and the population of the region's mega agglomerations and sprawling cities is expanding at roughly the same pace. By 2030 more than a quarter of the world's working adults will live in South Asia. But the region has not been particularly successful in integrating within itself and with the global economy. The demographic transition and urbanization on the one hand, and poor competitiveness on the other, are South Asia's greatest opportunity and greatest challenge. At a time when the growth rate of international trade has dramatically slowed, what will determine the region's ability to become an export powerhouse, create jobs, reduce poverty, and boost shared prosperity? South Asia's Turn: Policies to Boost Competitiveness and Create the Next Export Powerhouse looks for answers in the dynamics of firms, value chains, cities, and clusters across the region. The book identifies several factors that limit the ability of South Asia to compete with the rest of the world, and proposes new perspectives on opportunities to boost productivity.