ADB - GREATER integration brings benefits but also potentially huge risks, meaning Asian governments must work together to put in place policies and structures to ensure the region minimises those risks and reaps the benefits, the Asian Development Bank (ADB) said in its new Asian Economic Integration Monitor.
"Developing Asia's strong economic growth is in large part due to increased economic and financial ties within the region but greater integration can bring contagion and other risks and we must address those threats through closer cooperation," said Iwan J. Azis, head of ADB's Office of Regional Economic Integration. "Ultimately, integration should improve everyone's standard of living in the region."
Close integration speeds up the transmission of a crisis in one country to another as has been seen recently in Europe. In addition, greater integration may increase the income inequalities within countries even as it reduces the inequalities between countries.
With integration rising and set to continue in Asia, the region's governments need to co-operate more to offset these risks, the report says.