Pacific. Ocean. Northern Mariana. Islands. Marshall. Guam. Islands. Micronesia. Papua New. Votes coinciding with U.S. Islands. American. Samoa.

Transcription

1 mism; the emergence of ; and relationships between and, and, and and. It also encompasses all of America s five Asia Pacific treaty allies to include. Russia Kazakhstan North Korea Uzbekistan Iran ng Prosperity Key Asian Indicators: A 29 Book of Charts South Korea alia had the fifth-richest economy in the Asia-Pacific. In 28, hest, even surpassing the United States. In the last 2 years, many economies en their GDP per capita double or triple. Palau $, $2, of Economic Freedom $3, $4, $5, Pacific Ocean Northern Mariana Islands Asian Support for the U.S. in the U.N. Guam Marshall Islands How Asian and select other members of the United Nations voted on 88 key resolutions of the 28 General Assembly, in terms of coinciding with the U.S. vote. Even some of Papua New GuineaAmerica s best friends vote against us more often than with us. Solomon $23,63 $47,498 Votes coinciding with U.S. Votes coinciding against U.S. Islands n $3,26 $46,76 American Ocean on and Wall Street Journal rate and rank the world s economies $6,75 $43,752 Samoa Timor-Leste Important : business $5,398freedom, $39,36 trade freedom, fiscal freedom, government 44 votes Asian Nations, investment freedom, financial freedom, property rights, (half of total) $33,774 $38,443 on, and labor$37,597 freedom. $25,255 $27,7 $3,863 Asia World New Zealand $6,938 $3,67 Percentage Free Rank Rank Economy $,235 $9,5 SouthNew Korea $6,268 $8,952 Zealand attracts more global direct investment than any other country in Asia. When $4,623 $7, Hong Kong 9. of global totals. combined with Hong Kong, it accounts for more than percent $2,679 2 $4, are Percentage of Total World Foreign Direct Investment Inflows $,965 eir 3 $4, their $2,473 5 $3,869 New Zealand % $ % 6 $3,263 United States % $,436 9 $2, $,89 35 $2, % Papua New Guinea ((excluding l di $,784 Brunei Darussalam 4 $2, Hong Kong and $,427 $2,48 Macao) $,89 $2, Hong Kong $,929 $2,2 3.7% % $82 $2, Sri Lanka $452 $, Samoa $662 $, Vanuatu to The World Bank Group According $,27 $, o $575 $, % Asia World 5% Only nation $,276 Rank Nation Rank in Asia with a decline from 997 to 28 $, ad $9934 $, Promising North Korea $4266 $,68 2 New Zealand 2 as Economies 5% 9 Sri Lanka 56. $356 $,52 3 Hong Kong 3 Asia boasts three of h the top Papua New Guinea five easiest $4862 $,3 4 United States 4 2.5% 44 votes places in the world to Select Other Nations (half of total) $34623 $ % 5 Absent or abstained Market Attraction The Best Places to Do Business do business: $3826 $65 Tonga 54. New 2 6, is the easiestisrael place in the world Zealand, United Kingdom business. It ranks to 995 close an insolvent $383 $ and Hong 5 7 Kong.,, in the bottom half of the table in Canada n/a32 $ and, terms of tax burden on businesses. Ukraine.4% round out the top 2. $2633 $ Turkey 5% ss All seven finish ahead n/a39 $ Mexico of Switzerland, 988 $3443 $233 Germany, 52 Tonga Colombia and France This is according to Uganda nd % the World Bank, d. South Africa 57 Samoa 3 which each year 49 Timor-Leste 5.5 nt country29 in. surveys business 59 Vanuatu 4 529; 3Indicators Source: U.S. Department of State, Voting Practices in.3% the United Nations 28, at evelopment International Monetarypeople Fund,5.4 World Outlook around the Economic Database % world on ten measures of ease, 79 Kiribati Solomon Islands 46. e is often talked 2about in the including starting a Kiribati 45.7employing business, company of the G-7 developed 87 8 United Source: Nations Conference on Trade and Development, Foreign Direct Investment Statistics, World Investment Report 29, workers, countries. It is a vastly more difficult protecting at investors, and 89 9 place to do business, however North Korea 2. contracts. protecting n. a Asian Studies Center The Heritage Foundation November 29, Brunei, Palau Brunei 96 Palau 29 Index of Economic Freedom (Washington, D.C.:The Heritage Foundation and Dow Jones & Company, Inc., Marshall Islands 23 Difficult Environments Asia is represented on the lower end of the ease spectrum most significantly by, the, and. It is as hard to get credit in the as it is in Ethiopia and. In only ten countries in the world is it harder to start a business than it is in Papua New Guinea 2 25 Solomon Islands Timor-Leste is making strides in improving several of its rankings, but it still takes nearly a year to obtain a construction permit there. It requires about ten times as much capital and takes almost three times as long to start a business as in an average OECD country. I di It is as easy to get credit in as it 24 Massachusetts 44 NE Washington, DC heritage.org Avenue, 33 is in Canada. But there is only one place in the world (Timor-Leste) where enforcing contracts is a bigger problem. Source: 2 Rankings on the Ease of Doing Business, Doing Business 2 report, covering the period of June 28 through May 29, at

2 Key Asian Indicators: A 29 Book of Charts The United States is no less a Pacific nation than an Atlantic one. The state of Hawaii and the territories of Guam, Northern Mariana Islands, and American Samoa all lie in the Pacific. The United States has five treaty alliances in East Asia (, Korea,, the and ), the Pacific Fleet, and major military bases throughout the region. It has legal obligations to s security, and a burgeoning economic relationship with mainland. In South Asia, the United States is establishing a multifaceted partnership with ; it has a critical partner in nuclear-armed ; and is leading a war against global terrorism in. America s presence in Asia is massive and deliberate. It is the product of more than years of commitment and sacrifice, including the Spanish American War, World War II, the Korean War, the War, and today s war in. The United States is in Asia to stay. The graphics that follow help to demonstrate why. A quick glance is enough to demonstrate the dynamism of the region. Asia is home to more than half the world s population. Freedom and tyranny live side by side across the region, as do economic opportunity and poverty. East and South Asia have some of the best places in the world to do business, but they also have some of the worst. Asia is home to some of the most unstable, dangerous nations in the world, and it is home to some of the most steady and reliable. It is also home to the only country in the world capable of emerging as a peer competitor for global American influence the People s Republic of. Asia is a work very much in progress. Its sheer size makes its development a determining factor in protecting and promoting American interests and values. Its growth means it will only become more important in the future. And Asia s dynamism means that nothing about its development can be taken for granted. 24 Massachusetts Avenue, NE Washington, DC

3 Table of Contents Page Defining the Region... Key Areas of Dispute...2 Political Instability...3 The State of Political Freedom...4 The Best Places to Do Business...5 Market Attraction...6 Worldwide Direct Investment...7 Booming Trade...8 Growing Prosperity...9 Economic Stakes... The State of Economic Freedom... s Military Size Dominates Asia...2 North Korea Is Asia s Most Militarized...3 Will Be World s Most Populous Nation...4 Asian Support for the U.S. in the U.N....5 iii

4 Defining the Region We have defined an Asia bordering on Iran in the West, the Pacific in the East, Russia in the North, and included and New Zealand, as well as the Pacific islands. This captures several critical geo-economic and geopolitical features: East Asian dynamism; the emergence of ; and relationships between and, and, and and. It also encompasses all of America s five Asia Pacific treaty allies to include. Russia Uzbekistan Kazakhstan North Korea Iran n Ocean Timor-Leste South Korea Northern Mariana Islands Guam Palau Papua New Guinea Pacific Ocean Solomon Islands Marshall Islands American Samoa New Zealand Page

5 Key Areas of Dispute Disputed Areas: and Disputed borders Disputed territories South Sea Hainan Pacific Ocean Tibet New Delhi s claims South Sea Russia Uzbekistan Iran Kazakhstan Kashmir Border Dispute NORTHERN AREAS Disputed areas South Korea Timor-Leste North Korea Palau Papua New Guinea Pacific Ocean s Status (sovereignty unsettled ) Solomon Islands Islamabad Line of Control Srinagar JAMMU AND KASHMIR New Zealand Jammu Page 2

6 Political Instability Failed states are synonymous with national security threats. Unfortunately, as measured by the Failed States Index prepard by the Fund for Peace and Foreign Policy magazine, Asia has its fair share of instability. Asia Rank World Rank Score Alert Warning North Korea Timor-Leste Solomon Islands and American friends like nuclear-armed are among the ten states in the world most at risk of failure. Rogue threats to national security like North Korea and perennial American concerns like also share this critical status Papua New Guinea Samoa and Many other Asian countries fall in the next lower category. and are not generally thought of as states at risk of failure for opposite reasons. is often thought stable because of central authoritarian control by the Communist Party. But, for good reason, in the Failed State Index, this is a negative factor. Indeed, s democratic traditions are a stabilizing factor. Yet both are threatened by demographic changes, group grievances, and uneven development. 25 Brunei Darussalam Moderate United States Sustainable New Zealand A and d New N ZealandZ l d and New Zealand are among the most stable countries in the world, followed closely in the region by,, and. Source: Failed State Index 29, Fund for Peace and Foreign Policy, at Page 3

7 The State of Political Freedom Asia has an extraordinary mix of political systems from some of the freest to the most oppressive, as ranked by Freedom House. The freer the country, the more likely it is to be America s friend. Asia Rank Nation World Rank Free America s alliance network in the Pacific is supported by shared core democratic values. Among our allies,,, and are all rated Free., home to the world s largest democracy, is also rated as Free Kiribati Marshall Islands New Zealand Palau Tuvalu United States Samoa Vanuatu is among the freest countries in Asia a fact that often seems overlooked, even when states in the region convene to talk about democracy. Four of the most democratic nations in the region have diplomatic relations with Partly Free American allies the and are rated Partly Free Hong Kong Papua New Guinea Solomon Islands Timor-Leste is the freest nation in Southeast Asia Tonga Not Free Asia s other giant,, is rated as Not Free Brunei North Korea North Korea and The two countries in the region that pose the greatest challenge to U.S. foreign policy are controlled by the most oppressive governments Source: Freedom House, Freedom in the World 29: Global Data, at Page 4

8 The Best Places to Do Business According to The World Bank Group Promising Economies Asia boasts three of the top five easiest places in the world to do business:, New Zealand, and Hong Kong.,,, and round out the top 2. All seven finish ahead of Switzerland, Germany, and France. This is according to the World Bank, which each year surveys business people around the world on ten measures of ease, including starting a business, employing workers, protecting investors, and protecting contracts. Difficult Environments Asia is represented on the lower end of the ease spectrum most significantly by, the, and. It is as hard to get credit in the as it is in Ethiopia and. In only ten countries in the world is it harder to start a business than it is in. Asia Rank Nation New Zealand Hong Kong United States Tonga Samoa Vanuatu Kiribati Brunei Palau Marshall Islands Papua New Guinea Solomon Islands Timor-Leste World Rank is the easiest place in the world to close an insolvent business. It ranks in the bottom half of the table in terms of tax burden on businesses. is often talked about in the company of the G-7 developed countries. It is a vastly more difficult place to do business, however. is making strides in improving several of its rankings, but it still takes nearly a year to obtain a construction permit there. It requires about ten times as much capital and takes almost three times as long to start a business as in an average OECD country. It is as easy to get credit in as it is in Canada. But there is only one place in the world (Timor-Leste) where enforcing contracts is a bigger problem. Source: 2 Rankings on the Ease of Doing Business, Doing Business 2 report, covering the period of June 28 through May 29, at Page 5

9 Market Attraction attracts more global direct investment than any other country in Asia. When combined with Hong Kong, it accounts for more than percent of global totals. Percentage of Total World Foreign Direct Investment Inflows (excluding Hong Kong and Macao) 5% % 5% 6.4% Hong Kong 5% 3.7% % 2.8% % 5% 2.5% %.4% 5% %.3% Source: United Nations Conference on Trade and Development, Foreign Direct Investment Statistics, World Investment Report 29, at Page 6

10 Worldwide Direct Investment The United States invests more money in physical assets beyond its borders than the combined total of Asia s 23 largest investors. Foreign Direct Investment Outflows through 28 United States $3,62 billion Asian 23-Nation Total: Next-4-largest $2,45 billion investor nations in Asia $63 billion $62 billion $68 billion $96 billion $48 billion $75 billion $89 billion $95 billion $68 billion $776 billion Hong Kong Source: United Nations Conference on Trade and Development, Foreign Direct Investment Statistics, World Investment Report 29, at Page 7

11 Booming Trade Asia accounts for more than a quarter of all global trade in goods and services more than the U.S. and the European Union combined. Percentage of Total Global Exports, 28 United States 9.% European Union 3.4% Asia 28% Rest of World 49.5% 7.9% Rest of Asia 8.4% 4.7% Hong Kong 2.3% 2.5% 2.% Percentage of Total Global Imports, 28 United States 2.7% European Union 4.6% Asia 27% Rest of World 45.7% 6.5% Rest of Asia 9% 4.7% Hong Kong 2.2% 2.6% 2.% Sources: World Trade Organization, Trade Profiles Database, Page 8

12 Growing Prosperity In 997, had the fifth-richest economy in the Asia-Pacific. In 28, became the richest, even surpassing the United States. In the last 2 years, many economies in Asia have seen their GDP per capita double or triple. United States Brunei Darussalam Macau Hong Kong New Zealand Palau Samoa Marshall Islands Tonga Vanuatu Kiribati Solomon Islands Papua New Guinea Timor-Leste* $23,63 $3,26 $6,75 $5,398 $33,774 $25,255 $27,7 $6,938 $,235 $6,268 $4,623 $2,679 $,965 $2,473 $774 $,436 $,89 $,784 $,427 $,89 $,929 $82 $452 $662 $,27 $575 $,484 $993 $426 $356 $486 $346 $38 $38 n/a $26 n/a $34 $47,498 $46,76 $43,752 $39,36 $38,443 $37,597 $3,863 $3,67 $9,5 $8,952 $7, $4,25 $4,59 $3,869 $3,263 $2,883 $2,655 $2,548 $2,48 $2,254 $2,2 $2,2 $,998 $,979 $,847 $,357 $,276 $,267 $,68 $,52 $,3 $837 $65 $494 $453 $44 $429 $233 $, $2, $3, $4, $5, Only nation in Asia with a decline from 997 to 28 * Became an independent country in. Sources: World Bank Development Indicators 29; International Monetary Fund, World Outlook Economic Database 29. Page 9

13 Economic Stakes At $4.2 trillion, the U.S. economy is nearly three times the size of s, Asia s largest, and comparable to all the Asian economies in this list combined ($5 trillion). is very likely to surpass as the No. 2 economy in the world in 2. Asia s Big Two After the U.S., and are the biggest economies in the world. is one of the largest economies in Asia very modern, and along with,, and Hong Kong, one of the original Asian Tigers. United States Hong Kong New Zealand Macau Brunei Darussalam Papua New Guinea Solomon Islands Vanuatu Samoa Timor-Leste Tonga Palau Marshall Islands Kiribati Gross Domestic Product in 28, in Billions $4,24.3 $4,99.3 $4,326.2 $,27.5 $,5.2 $929. $54.4 $424. $26.7 $25.4 $94.9 $8.9 $68.3 $66.9 $3.7 $9.7 $79. $4.7 $2.9 $7.2 $3.7 $2.9 $2.6 $9.6 $8.2 $5.3 $5.2 $3.5 $.4 $.3 $.6 $.6 $.5 $.5 $.3 $.2 $.2 $.2 $. ASEAN The ten member countries of ASEAN the Association of Southeast Asian Nations combine for an economy of more than $.4 trillion, the third largest in Asia. Since 992, ASEAN has been engaged in an effort to integrate its national economies to create competitive, attractive economies of scale. It is aiming for ASEAN Economic Community by 25. The national economies of ASEAN are extraordinarily diverse in size and activity. Sources: World Bank Development Indicators 29; International Monetary Fund, World Outlook Economic Database 29. Page

14 The State of Economic Freedom The Heritage Foundation and Wall Street Journal rate and rank the world s economies according to factors: business freedom, trade freedom, fiscal freedom, government size, monetary freedom, investment freedom, financial freedom, property rights, freedom from corruption, and labor freedom. Free Four of the five freest economies in the world are in the Asia Pacific. And their freedom correlates with their high per capita GDPs. Mostly Free Moderately Free The countries in this category are well above the world average. South Korea scores particularly well on business freedom. Mostly Unfree Some of the largest economies in Asia fall into this category. took off 3 years ago by instituting market-oriented economic reforms, and has grown at an average of 9 percent a year since. With reform, shook off its socialist stagnation. But it must grow at 6.5 percent a year just to keep up with its expanding work force. has compensated for a difficult business environment through reliance on natural resource development and resilient domestic demand. Repressed Few countries want to be in the company of North Korea and, but suffers from a high degree of corruption. Asia Rank World Rank Economy Hong Kong New Zealand United States Samoa Vanuatu Papua New Guinea Tonga Timor-Leste Solomon Islands Kiribati North Korea Percentage Free Not Ranked, Brunei, Palau Source: Terry Miller and Kim R. Holmes, 29 Index of Economic Freedom (Washington, D.C.: The Heritage Foundation and Dow Jones & Company, Inc., 29), at Page

15 s Military Size Dominates Asia When comparing active-duty personnel, s army alone is larger than any other Asian nation s entire military. In pure numbers, it even exceeds the size of the U.S. military. Total Active Duty 2,85,,6, 255, 3, United States,539, , ,4 34,53,28,2,, 55, 2, North Korea,6, 95, 46,, 692, 56, 68, 64, 67, 55,, 45, 455, 42, 3, 3, 46, 375, 6, 5, 36,6 9, 7,6 46, 32, 233, 45, 24, 29, 2, 45, 45, 8, 38,4 44, 45,6 57,53 26,53 6,9 4, 5,9 7,9 5, 8, 24,3 2, 2,8,5 9, 8, 4, 5, 6, 66, 24, 6, 72,5 5, 9, 3,5 69, 69, 54,747 27,46 3,23 4,56 53,4 52,,4 29, 25,6 3,5, 8,9 8 New Zealand 9,278 4,754 2,2 2,54 Brunei 7, 4,9,, 3,5 3,2 3 Papua New Guinea 3, 2,5 4 2 Timor-Leste,286,25 36 % 25% 5% of s Size Army Navy Air Force Source: James Hackett, ed.,the Military Balance 29 (The International Institute for Strategic Studies, Oxfordshire: Routledge Journals, 29). Page 2

16 North Korea Is Asia s Most Militarized Nearly 5 percent of North Korea s entire population is active-duty military personnel, a rate more than double that of other Asian nations. Nation Total Population Total Active Military North Korea 23,479,89,6, 4.7% Brunei 38,37 7,.84% 4,68,67 72,5.57% 49,232, ,.4%,92,946 29,.27% 4,24,64 24,3.87% 47,758,8 46,.85% 2,28,773 5,9.7% 86,6, ,.53% United States 33,824,646,539,587.5% 65,493,298 36,6.47% 6,677,534 29,.44% 25,274,33 9,.43% 93,74 3,5.38% 67,762,4 67,.37% 2,996,8,.33% 2,6,856 54,747.27% 29,59,4 69,.23% New Zealand 4,73,46 9,278.% 27,288,49 8,.8%,33,44,65 2,85,.6% 32,738,376 53,4.6% 237,52,355 32,.3% Timor-Leste,4,88,286.2% 92,68,453 6,.%,47,995,898,28,2.% 53,546,9 57,53.% Papua New Guinea 5,93,769 3,.5% Percentage of Population in Active Military % 25% 5% of North Korea s Rate Source: James Hackett, ed.,the Military Balance 29 (The International Institute for Strategic Studies, Oxfordshire: Routledge Journals, 29). Page 3

17 Will Be World s Most Populous Nation is projected to supplant as Asia s most populous nation by 23. The two nations have nearly twice the population as the combined total of the rest of Asia. Asia accounts for 6 percent of the world s population billion.2 billion is the young man of Asia. One-quarter of its. billion people are under the age of 5, more than half are under age 25, and more than two-thirds are under age 35. s is the middle-aged man of Asia. Currently the largest country in the world by population, its demographic boom is ending. 8 million United States s population is aging rapidly and expected to decline over the next 2 years. 4 million The American population is predicted to grow at an average rate of about 8 million per decade. It is the fastest growing of any developed country. 26 other nations Sources: United Nations, Population Division, World Population Prospects: The 28 Revision, at Council for Economic Planning and Development, at Page 4

18 Asian Support for the U.S. in the U.N. How Asian and select other members of the United Nations voted on 88 key resolutions of the 28 General Assembly, in terms of coinciding with the U.S. vote. Even some of America s best friends vote against us more often than with us. Votes coinciding with U.S. Votes coinciding against U.S. Absent or abstained Asian Nations New Zealand Papua New Guinea Brunei Darussalam North Korea Select Other Nations Israel United Kingdom Canada Ukraine Turkey Mexico Colombia Uganda South Africa Important 44 votes (half of total) 44 votes (half of total) Source: U.S. Department of State, Voting Practices in the United Nations 28, at Page 5

19 Walter Lohman Director Asian Studies Center Credits Nicholas Hamisevicz Research Assistant Asian Studies Center John W. Fleming Senior Data Graphics Editor The Heritage Foundation is a research and educational institution a think tank whose mission is to formulate and promote conservative public policies based on the principles of free enterprise, limited government, individual freedom, traditional American values, and a strong national defense. Our vision is to build an America where freedom, opportunity, prosperity, and civil society flourish. As conservatives, we believe the values and ideas that motivated our Founding Fathers are worth conserving. As policy entrepreneurs, we believe the most effective solutions are consistent with those ideas and values. The American Leadership Initiative is one of Transformational Initiatives making up The Heritage Foundation s Leadership for America campaign. For more products and information related to this initiative or to learn more about the Leadership for American campaign, please visit heritage.org.

20 24 Massachusetts Avenue, NE Washington, DC heritage.org