Narrowing the Development Divide in ASEAN: The Role of Policy

Jayant Menon ()

No 100, Working Papers on Regional Economic Integration from Asian Development Bank

Abstract: The Association of Southeast Asian Nations (ASEAN) is highly diverse. It is also divided. The most striking example is the development divide that separates ASEAN’s newer members of Cambodia, the Lao People’s Democratic Republic, Myanmar, and Viet Nam—the CLMV countries—from the organization’s original members, or ASEAN-6. More rapid growth in Cambodia, Lao People’s Democratic Republic, and Viet Nam since the 1990s—driven by trade, investment, and other market reforms—has reduced income differences between this grouping and ASEAN-6. Yet, while the development divide has narrowed, huge gaps remain. The further narrowing of these gaps will require an increase in the pace and breadth of policy reforms, and start addressing labor mobility. Although rapid growth has resulted in convergence among ASEAN members, it has also increased polarization within individual countries. This can threaten social cohesion and the sustainability of future growth. There is a pressing need to invest more in education and health, and to institute land reform.

Keywords: ASEAN; development divide; convergence; inequality; transition economies; labor mobility (search for similar items in EconPapers)
JEL-codes: F15 O24 (search for similar items in EconPapers)
Pages: 44 pages
Date: 2012-07-01
New Economics Papers: this item is included in nep-cwa and nep-sea
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Citations: View citations in EconPapers (5)

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Journal Article: Narrowing the development divide in ASEAN: the role of policy (2013)
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