Asian Development Bank (ADB) released a report titled “Asian Economic Integration Report 2015: How Can Special Economic Zones Catalyze Economic Development?”
- The Asian Economic Integration Report (AEIR) 2015 was prepared by the Regional Cooperation and Integration Division (ERCI) of ADB’s Economic Research and Regional Cooperation Department (ERCD).
- The report examined the current trends in trade, finance, migration, remittances and other economic activities in the region.
Key Highlights of Report
- Asia has emerged as an important source of outward foreign direct investment (FDI). Its outward FDI increased faster than inward FDI growing 45.3% in 2014 compared with 2010.
- Asia’s income elasticity of trade declined from 2.69 before the global financial crisis (2008-09) to 1.30 in 2015.
- The value of Asia’s intermediate goods trade of almost 60% of total trade has contracted 2.6 % in 2014.
- Asia remains the world’s largest source of international migrants, accounting for a third of the global total in 2013 and the region also accounted for nearly 50% of global remittances in 2014.
- Special economic zones (SEZs) became a driving force for increased trade, investment and economic reform in Asia at a time the region is experiencing a slowdown in trade.
- The expansion in the number of SEZs from 500 in 1995 to over 4300 in 2015 shows the strong and rising interest to this form of policy experiment.
- In developing Asia, countries with SEZs attract significantly more FDI, corresponding to 82% greater FDI levels.
Report with respect to India
- India has become the 3rd largest source of inward FDI for the United Kingdom (UK) after the US and France in number of projects.
- Indian economy switched focus to higher technology products as compared with 1990 when it focused mainly on low-technology exports
- India’s labor productivity slowed in agriculture is mainly due to falling investment, diversion of productive agricultural land to nonfarm purposes, and climate change which reduced most farm yields.