Asia Needs to Consume, Not Just Produce: ADB

Governments across Asia must rely less on exports for growth, and instead build up effective social safety nets to promote domestic demand, said Asian Development Bank's (ADB) managing director general, Rajat Nag, as the export-reliant nature of the region remains a key risk in the medium term.

"The time has come to think of Asia as a consumer as well as a producer," Nag told CNBC Tuesday. "The rebalancing of growth has to take place."

Asians, who are recognized as the "savers" of the world, have been burdened with stashing away funds for possible ill health, old age and education, he said, leaving less room for discretionary spending.

"The time has come to think of Asia as a consumer as well as a producer." -Asian Development Bank, Rajat Nag

While China and India have indicated plans to boost domestic consumption, Nag says this will take time. "It's like changing the direction of a super tanker."

At the meeting of ruling Communist Party of China (CPC) leaders on Monday, Beijing discussed the economy's blueprint for the next five years, and agreed on the need to focus on household wealth and increasing domestic consumption.

Nag agrees that the mainland's emphasis on inclusive growth is critical. "That actually means you just don't grow, you (also) want to make sure people, particularly bottom of the pyramid have access to opportunity. "

Asia's middle-class will continue to emerge as the world's primary global consumers, said Nag. According to figures from the ADB, 56 percent of Asian consumers are classified as "middle class" in 2010, compared to 21 percent in 1990.

"This middle class in Asia is going to drive consumption, and that'll be a critical part of this (global) rebalancing," he concluded.