The Four Asian Tigers (also known as the Four Asian Dragons or Four Little Dragons in
Chinese
Chinese can refer to:
* Something related to China
* Chinese people, people of Chinese nationality, citizenship, and/or ethnicity
**''Zhonghua minzu'', the supra-ethnic concept of the Chinese nation
** List of ethnic groups in China, people of ...
and
Korean
Korean may refer to:
People and culture
* Koreans, ethnic group originating in the Korean Peninsula
* Korean cuisine
* Korean culture
* Korean language
**Korean alphabet, known as Hangul or Chosŏn'gŭl
**Korean dialects and the Jeju language
** ...
) are the developed East Asian economies of
Hong Kong
Hong Kong ( (US) or (UK); , ), officially the Hong Kong Special Administrative Region of the People's Republic of China (abbr. Hong Kong SAR or HKSAR), is a city and special administrative region of China on the eastern Pearl River Delta i ...
,
Singapore
Singapore (), officially the Republic of Singapore, is a sovereign island country and city-state in maritime Southeast Asia. It lies about one degree of latitude () north of the equator, off the southern tip of the Malay Peninsula, bor ...
,
South Korea
South Korea, officially the Republic of Korea (ROK), is a country in East Asia, constituting the southern part of the Korean Peninsula and sharing a land border with North Korea. Its western border is formed by the Yellow Sea, while its eas ...
, and
Taiwan
Taiwan, officially the Republic of China (ROC), is a country in East Asia, at the junction of the East and South China Seas in the northwestern Pacific Ocean, with the People's Republic of China (PRC) to the northwest, Japan to the nort ...
. Between the early 1960s and 1990s, they underwent rapid industrialization and maintained exceptionally high growth rates of more than 7 percent a year.
By the early 21st century, these economies had developed into
high-income economies, specializing in areas of competitive advantage. Hong Kong and Singapore have become leading international
financial centres, whereas South Korea and Taiwan are leaders in manufacturing
electronic
Electronic may refer to:
*Electronics, the science of how to control electric energy in semiconductor
* ''Electronics'' (magazine), a defunct American trade journal
*Electronic storage, the storage of data using an electronic device
*Electronic co ...
components and devices. Large institutions have pushed to have them serve as role models for many
developing countries
A developing country is a sovereign state with a lesser developed industrial base and a lower Human Development Index (HDI) relative to other countries. However, this definition is not universally agreed upon. There is also no clear agreem ...
, especially the
Tiger Cub Economies
The Tiger Cub Economies collectively refer to the economies of the developing countries of Indonesia, Malaysia, the Philippines, Thailand and Vietnam, the five dominant countries in Southeast Asia.
Overview
The Tiger Cub Economies are so named b ...
of southeast Asia.
In 1993, a
World Bank
The World Bank is an international financial institution that provides loans and grants to the governments of low- and middle-income countries for the purpose of pursuing capital projects. The World Bank is the collective name for the Inte ...
report ''The East Asian Miracle'' credited
neoliberal policies with the economic boom, including the maintenance of
export-oriented policies, low taxes and minimal
welfare state
A welfare state is a form of government in which the state (or a well-established network of social institutions) protects and promotes the economic and social well-being of its citizens, based upon the principles of equal opportunity, equita ...
s. Institutional analyses found that some level of
state intervention was involved.
[
] Some analysts argued that industrial policy and state intervention had a much greater influence than the World Bank report suggested.
Overview
![Four Tigers GDP per capita](https://upload.wikimedia.org/wikipedia/commons/2/2c/Four_Tigers_GDP_per_capita.svg)
Prior to the
1997 Asian financial crisis, the growth of the Four Asian Tiger economies (commonly referred to as "the Asian Miracle") has been attributed to export oriented policies and strong development policies. Unique to these economies were the sustained rapid growth and high levels of equal income distribution. A World Bank report suggests two development policies among others as sources for the Asian miracle: factor accumulation and macroeconomic management.
The Hong Kong economy was the first out of the four to undergo industrialization with the development of a textile industry in the 1950s. By the 1960s, manufacturing in the British colony had expanded and diversified to include clothing, electronics, and plastics for
export orientation. Following Singapore's independence from
Malaysia
Malaysia ( ; ) is a country in Southeast Asia. The federation, federal constitutional monarchy consists of States and federal territories of Malaysia, thirteen states and three federal territories, separated by the South China Sea into two r ...
, the
Economic Development Board
The Economic Development Board (EDB) is a statutory board under the Ministry of Trade and Industry of the Government of Singapore that plans and executes strategies to sustain Singapore as a leading global hub for business and investment.
Hi ...
formulated and implemented national economic strategies to promote the country's manufacturing sector.
Industrial estate
An industrial park (also known as industrial estate, trading estate) is an area zoned and planned for the purpose of industrial development. An industrial park can be thought of as a more "heavyweight" version of a business park or office park ...
s were set up and foreign investment was attracted to the country with tax incentives. Meanwhile, Taiwan and South Korea began to industrialize in the mid-1960s with heavy government involvement including initiatives and policies. Both countries pursued export-oriented industrialization as in Hong Kong and Singapore.
The four countries were inspired by Japan's evident success, and they collectively pursued the same goal by investing in the same categories: infrastructure and education. They also benefited from foreign trade advantages that set them apart from other countries, most significantly economic support from the United States; part of this is manifested in the proliferation of American electronic products in common households of the Four Tigers.
By the end of the 1960s, levels in physical and
human capital in the four economies far exceeded other countries at similar levels of development. This subsequently led to a rapid growth in per capita income levels. While high investments were essential to their economic growth, the role of human capital was also important. Education in particular is cited as playing a major role in the Asian economic miracle. The levels of education enrollment in the Four Asian Tigers were higher than predicted given their level of income. By 1965, all four nations had achieved universal primary education.
South Korea in particular had achieved a secondary education enrollment rate of 88% by 1987.
There was also a notable decrease in the gap between male and female enrollments during the Asian miracle. Overall these advances in education allowed for high levels of literacy and cognitive skills.
The creation of stable
macroeconomic
Macroeconomics (from the Greek prefix ''makro-'' meaning "large" + ''economics'') is a branch of economics dealing with performance, structure, behavior, and decision-making of an economy as a whole.
For example, using interest rates, taxes, and ...
environments was the foundation upon which the Asian miracle was built. Each of the Four Asian Tiger states managed, to various degrees of success, three variables in:
budget deficits
The government budget balance, also alternatively referred to as general government balance, public budget balance, or public fiscal balance, is the overall difference between government revenues and spending. A positive balance is called a '' ...
,
external debt
A country's gross external debt (or foreign debt) is the liabilities that are owed to nonresidents by residents. The debtors can be governments, corporations or citizens. External debt may be denominated in domestic or foreign currency. It inclu ...
and
exchange rates
In finance, an exchange rate is the rate at which one currency will be exchanged for another currency. Currencies are most commonly national currencies, but may be sub-national as in the case of Hong Kong or supra-national as in the case of ...
. Each Tiger nation's budget deficits were kept within the limits of their financial limits, as to not destabilize the macro-economy. South Korea in particular had deficits lower than the
OECD
The Organisation for Economic Co-operation and Development (OECD; french: Organisation de coopération et de développement économiques, ''OCDE'') is an intergovernmental organisation with 38 member countries, founded in 1961 to stimulate e ...
average in the 1980s. External debt was non-existent for Hong Kong, Singapore and Taiwan, as they did not borrow from abroad.
Although South Korea was the exception to this – its debt to GNP ratio was quite high during the period 1980–1985, it was sustained by the country's high level of exports. Exchange rates in the Four Asian Tiger nations had been changed from long-term fixed rate regimes to fixed-but-adjustable rate regimes with the occasional steep devaluation of managed floating rate regimes.
This active exchange rate management allowed the Four Tiger economies to avoid exchange rate appreciation and maintain a stable real exchange rate.
Export policies have been the de facto reason for the rise of these Four Asian Tiger economies. The approach taken has been different among the four nations. Hong Kong, and Singapore introduced trade regimes that were neoliberal in nature and encouraged free trade, while South Korea and Taiwan adopted mixed regimes that accommodated their own export industries. In Hong Kong and Singapore, due to small domestic markets, domestic prices were linked to international prices. South Korea and Taiwan introduced export incentives for the traded-goods sector. The governments of Singapore, South Korea and Taiwan also worked to promote specific exporting industries, which were termed as an export push strategy. All these policies helped these four nations to achieve a growth averaging 7.5% each year for three decades and as such they achieved
developed country status.
Dani Rodrik, economist at the John F. Kennedy School of Government at Harvard University, has in a number of studies argued that state intervention was important in the East Asian growth miracle.
He has argued "it is impossible to understand the East Asian growth miracle without appreciating the important role that government policy played in stimulating private investment".
1997 Asian financial crisis
The Tiger economies experienced a setback in the
1997 Asian financial crisis. Hong Kong came under intense speculative attacks against its stock market and currency necessitating unprecedented market interventions by the state
Hong Kong Monetary Authority. South Korea was hit the hardest as its foreign debt burdens swelled resulting in its currency falling between 35 and 50%.
By the beginning of 1997, the stock market in Hong Kong, Singapore, and South Korea also saw losses of at least 60% in dollar terms. Singapore and Taiwan were relatively unscathed. The Four Asian Tigers recovered from the 1997 crisis faster than other countries due to various economic advantages including their high savings rate (except South Korea) and their openness to trade.
2008 financial crisis
The export-oriented tiger economies, which benefited from American consumption, were hit hard by the
financial crisis of 2007–08
Finance is the study and discipline of money, currency and capital assets. It is related to, but not synonymous with economics, the study of production, distribution, and consumption of money, assets, goods and services (the discipline of f ...
. By the fourth quarter of 2008, the GDP of all four nations fell by an average annualized rate of around 15%.
Exports also fell by a 50% annualized rate.
Weak domestic demand also affected the recovery of these economies. In 2008, retail sales fell 3% in Hong Kong, 6% in Singapore and 11% in Taiwan.
As the world recovered from the financial crisis, the Four Asian Tiger economies have also rebounded strongly. This is due in no small part to each country's government fiscal stimulus measures. These fiscal packages accounted for more than 4% of each country's GDP in 2009.
Another reason for the strong bounce back is the modest corporate and household debt in these four nations.
A recent article published in ''Applied Economics Letters'' by financial economist Mete Feridun of University of Greenwich Business School and his international colleagues investigates the causal relationship between financial development and economic growth for
Thailand
Thailand ( ), historically known as Siam () and officially the Kingdom of Thailand, is a country in Southeast Asia, located at the centre of the Indochinese Peninsula, spanning , with a population of almost 70 million. The country is b ...
,
Indonesia
Indonesia, officially the Republic of Indonesia, is a country in Southeast Asia and Oceania between the Indian and Pacific oceans. It consists of over 17,000 islands, including Sumatra, Java, Sulawesi, and parts of Borneo and New Guine ...
,
Malaysia
Malaysia ( ; ) is a country in Southeast Asia. The federation, federal constitutional monarchy consists of States and federal territories of Malaysia, thirteen states and three federal territories, separated by the South China Sea into two r ...
, the
Philippines
The Philippines (; fil, Pilipinas, links=no), officially the Republic of the Philippines ( fil, Republika ng Pilipinas, links=no),
* bik, Republika kan Filipinas
* ceb, Republika sa Pilipinas
* cbk, República de Filipinas
* hil, Republ ...
, China,
India
India, officially the Republic of India (Hindi: ), is a country in South Asia. It is the seventh-largest country by area, the second-most populous country, and the most populous democracy in the world. Bounded by the Indian Ocean on the so ...
and Singapore for the period between 1979 and 2009, using
Johansen cointegration tests and vector
error correction models. The results suggest that in the case of Indonesia, Singapore, the Philippines, China and India financial development leads to economic growth, whereas in the case of Thailand there exists a bidirectional causality between these variables. The results further suggest that in the case of Malaysia, financial development does not seem to cause economic growth.
Gross domestic product (GDP)
![Maddison GDP per capita Four Asian Tigers 1950-2018](https://upload.wikimedia.org/wikipedia/commons/6/60/Maddison_GDP_per_capita_Four_Asian_Tigers_1950-2018.svg)
In 2018, the combined economy of the Four Asian Tigers constituted 3.46% of the world's economy with a total Gross domestic product (GDP) of 2,932 billion US dollars. The GDP in Hong Kong, Singapore, South Korea and Taiwan was worth 363.03 billion, 361.1 billion, 1,619.42 billion and 589.39 billion US dollars respectively in 2018, which represented 0.428%, 0.426%, 1.911% and 0.696% of the world economy. Together, their combined economy surpassed the United Kingdom's GDP of 3.34% of the world's economy some time in the mid 2010s. In 2021, each of the Four Asian Tigers' GDP Per capita (nominal) exceeds $30,000 according to IMF's estimate.
File:Skylines of the Central Business District, Singapore at dusk.jpg, Singapore
File:Seoul (South Korea).jpg, Seoul
Seoul (; ; ), officially known as the Seoul Special City, is the capital and largest metropolis of South Korea.Before 1972, Seoul was the ''de jure'' capital of the Democratic People's Republic of Korea (North Korea) as stated iArticle 103 of ...
, South Korea
File:Hong Kong Night view.jpg, Hong Kong
File:Taipei Skyline 2022.06.29.jpg, Taipei
Taipei (), officially Taipei City, is the capital and a special municipality of the Republic of China (Taiwan). Located in Northern Taiwan, Taipei City is an enclave of the municipality of New Taipei City that sits about southwest of the ...
, Taiwan
Education and technology
These four countries focused on investing heavily in their infrastructure as well as education to benefit their country through skilled workers and higher level jobs such as engineers and doctors. The policy was generally successful and helped develop the countries into more
advanced and
high-income
A high-income economy is defined by the World Bank as a nation with a gross national income per capita of US$12,696 or more in 2020, calculated using the Atlas method. While the term "high-income" is often used interchangeably with " First World" ...
industrialized
developed countries
A developed country (or industrialized country, high-income country, more economically developed country (MEDC), advanced country) is a sovereign state that has a high quality of life, developed economy and advanced technological infrastruct ...
. For example, all four countries have become global education centers with Singapore, Taiwan, South Korea and Hong Kong high school students scoring well on math and science exams such as the
PISA exam and with Taiwanese students winning several medals in International Olympiads.
In relation to secondary / higher level educations, there are many prestigious colleges as in most developed countries. Notable schools include the
National Taiwan University
National Taiwan University (NTU; ) is a public research university in Taipei, Taiwan.
The university was founded in 1928 during Japanese rule as the seventh of the Imperial Universities. It was named Taihoku Imperial University and served d ...
,
Seoul National University,
National University of Singapore,
Nanyang Technological University and
University of Hong Kong
The University of Hong Kong (HKU) (Chinese: 香港大學) is a public research university in Hong Kong. Founded in 1887 as the Hong Kong College of Medicine for Chinese, it is the oldest tertiary institution in Hong Kong. HKU was also the f ...
, Faculty of Dentistry, which as of 2017, was ranked as one of the top dental schools in the world.
Cultural basis
The role of
Confucianism
Confucianism, also known as Ruism or Ru classicism, is a system of thought and behavior originating in ancient China. Variously described as tradition, a philosophy, a religion, a humanistic or rationalistic religion, a way of governing, or a ...
has been used to explain the success of the Four Asian Tigers. This conclusion is similar to the
Protestant work ethic
The Protestant work ethic, also known as the Calvinist work ethic or the Puritan work ethic, is a work ethic concept in theology, sociology, economics and history which emphasizes that diligence, discipline, and frugality are a result of a per ...
theory in the West promoted by German sociologist
Max Weber in his book ''
The Protestant Ethic and the Spirit of Capitalism
''The Protestant Ethic and the Spirit of Capitalism'' (german: Die protestantische Ethik und der Geist des Kapitalismus) is a book written by Max Weber, a German sociologist, economist, and politician. Begun as a series of essays, the original ...
''. The
culture of Confucianism is said to have been compatible with industrialization because it valued stability, hard work, discipline, and loyalty and respect towards authority figures.
There is a significant influence of Confucianism on the corporate and political institutions of the Asian Tigers. Prime Minister of Singapore
Lee Kuan Yew
Lee Kuan Yew (16 September 1923 – 23 March 2015), born Harry Lee Kuan Yew, often referred to by his initials LKY, was a Singaporean lawyer and statesman who served as Prime Minister of Singapore between 1959 and 1990, and Secretary-General o ...
advocated
Asian values as an alternative to the influence of Western culture in Asia.
This theory was not without its critics. There was a lack of mainland Chinese economic success during the same time frame as the Four Tigers, and yet China was the birthplace of Confucianism. During the
May Fourth Movement
The May Fourth Movement was a Chinese anti-imperialist, cultural, and political movement which grew out of student protests in Beijing on May 4, 1919. Students gathered in front of Tiananmen (The Gate of Heavenly Peace) to protest the Chines ...
of 1919, Confucianism was blamed for China's inability to compete with Western powers.
In 1996, the economist Joseph Stiglitz pointed out that, ironically, "not that long ago, the Confucian heritage, with its emphasis on traditional values, was cited as an explanation for why these countries had not grown."
Some Lessons from the East Asian Miracle
, a 27-page paper published by the World Bank, Joseph E. Stiglitz, Aug. 1996. In addition to the Four Asian Tigers, Stiglitz also lists the economies of Japan, Indonesia, Malaysia, and Thailand as part of the East Asian Miracle.
Territory and region data
Credit ratings
Demographics
Economy
Quality of life
Technology
Politics
Organizations and groups
See also
* Developed country
* Developmental state
* The Pacific Pumas
* Economic miracle
Economic miracle is an informal economic term for a period of dramatic economic development that is entirely unexpected or unexpectedly strong. Economic miracles have occurred in the recent histories of a number of countries, often those undergoing ...
(full list of miracles and "tigers")
* Asian Century
The Asian Century is the projected 21st-century dominance of Asian politics and culture, assuming certain demographic and economic trends persist. The concept of Asian Century parallels the characterisation of the 19th century as Britain's Imp ...
* Pacific Century
* Baltic Tiger
* Celtic Tiger
The "Celtic Tiger" ( ga, An Tíogar Ceilteach) is a term referring to the economy of Ireland from the mid-1990s to the late 2000s, a period of rapid real economic growth fuelled by foreign direct investment. The boom was dampened by a subseque ...
* Tatra Tiger
"Tatra Tiger" is a nickname that refers to the economy of Slovakia in period 2002 – 2007, following the ascendance of a right-leaning coalition in September 2002 which engaged in a program of liberal economic reforms. The name "Tatra Tiger ...
* Newly industrialized country
The category of newly industrialized country (NIC), newly industrialized economy (NIE) or middle income country is a socioeconomic classification applied to several countries around the world by political scientists and economists. They represe ...
* Gulf Tiger The Gulf Tiger or Arab Gulf Tiger is a nickname used to describe the period of rapid economic growth in the city of Dubai. The boom that Dubai has been experiencing since the 1990s is still going on, transforming the city from a desert village to a ...
* Tiger economy
A tiger economy is the economy of a country which undergoes rapid economic growth, usually accompanied by an increase in the standard of living. The term was originally used for the Four Asian Tigers (South Korea, Taiwan, Hong Kong, and Singapor ...
* Korean Wave
* Japanese economic miracle
The Japanese economic miracle refers to Japan's record period of economic growth between the post-World War II era and the end of the Cold War. During the economic boom, Japan rapidly became the world's second-largest economy (after the Unit ...
* Miracle on the Han River
The Miracle on the Han River refers to the period of rapid economic growth in South Korea, following the Korean War (1950–1953), during which South Korea transformed from a least developed country to a developed country. The rapid reconstru ...
* Taiwan Miracle
The Taiwan Miracle () or Taiwan Economic Miracle refers to the rapid industrialization and economic growth of Taiwan during the latter half of the twentieth century.
As it developed alongside Singapore, South Korea and Hong Kong, Taiwan became ...
* Taiwanese Wave
Taiwanese wave ( ja, 台流, Tairyū) is a neologism originally coined in Japan to refer to the increase in the popularity of Taiwanese culture, Taiwanese popular culture in the country (including: actors, dramas, music, fashion, films), and ...
* Chinese economic reform
The Chinese economic reform or reform and opening-up (), known in the West as the opening of China, is the program of economic reforms termed " Socialism with Chinese characteristics" and " socialist market economy" in the People's Republic of ...
* Tiger Cub Economies
The Tiger Cub Economies collectively refer to the economies of the developing countries of Indonesia, Malaysia, the Philippines, Thailand and Vietnam, the five dominant countries in Southeast Asia.
Overview
The Tiger Cub Economies are so named b ...
* List of country groupings
Groups of countries or regions are often referred to by a single term (word, phrase, or abbreviation). The origins of such terms include political alliances, intergovernmental organizations, business market areas, and mere colloquialism.
...
* List of multilateral free-trade agreements
This is a list of multilateral free-trade agreements, between several countries all treated equally. For agreements between two countries, between a bloc and a country, or between two blocs, see list of bilateral free-trade agreements; these ar ...
Notes
References
Further reading
* Ezra F. Vogel, ''The Four Little Dragons: The Spread of Industrialization in East Asia'' (Cambridge, Massachusetts: Harvard University Press, 1991).
*Hye-Kyung Lee & Lorraine Lim, ''Cultural Policies in East Asia: Dynamics between the State, Arts and Creative Industries'' (Palgrave Macmillan, 2014).
*H. Horaguchi & K. Shimokawa, ''Japanese Foreign Direct Investment and the East Asian Industrial System: Case Studies from the Automobile and Electronics Industries (''Springer Japan, 2002).
External links
BBC report on the Asian Tigers in the aftermath of the 1997 Financial Crisis
(includes map of the Asian Tigers)
The Elephant at the Gate in ''China Economic Review''
{{Use dmy dates, date=January 2021
Tiger economies
Economic booms
Economic history of Asia
Economic history of Taiwan
Economy of East Asia
Economy of Hong Kong
Economy of Singapore
Economy of South Korea
Economy of Taiwan