A panel of Asian researchers said Thursday the global financial crisis has underlined the critical need for the region to grow less export-dependent and instead foster domestic demand.
The representatives from the Asian Development Bank Institute, which brings together economic experts on the region, acknowledged such change will require time, perhaps as much as a decade.
The panel, called Asian Policy Forum, released a policy recommendation report Thursday ahead of the Group of 20 summit next month in London, where tackling the crisis is expected to top the agenda.
The vulnerability of Asia economies caused by their extreme reliance on exports has been viewed as a major problem for decades. But the U.S. financial crisis, which threatens to bring more joblessness, poverty and social instability to Asia, is making the need for change more pressing than ever, researchers said.
"Exports to developed economies will be less of an engine of growth for the region," said Masahiro Kawai, dean of Asian Development Bank Institute, and one of 19 researchers from Asian think tanks who signed the report.
"East Asia will need policies to facilitate a shift toward inclusive, sustainable growth driven by regional demand," he said at the Foreign Correspondents' Club of Japan in Tokyo.
Among the recommendations were calls for the U.S. to clean up its financial and real estate sectors. It also proposed setting up a special fund in Asia as an alternative to the International Monetary Fund to help nations with financing problems.
Chalongphob Sussangkarn, of the Thailand Development Research Institute Foundation, said Asia had looked to the U.S. as a global leader but was learning from the financial crisis that the U.S. model for development was filled with weaknesses.
"Now, we are very confused about what is the best practice," he said, adding that looking to one nation for leadership may have been misguided. "We need to do it collectively. If we ask leaders to do reform, nothing will happen."