[Viewpoint] Korea’s lessons for AsiaAsia is aging. As the region’s population continues to grow older, with a shrinking proportion of young workers being relied on to maintain social security systems for a growing number of retirees, it will become increasingly important to enhance the productivity of Asia’s young workforce. This will require a massive expansion of Asian economies and dramatic improvements in the quality of countries’ workforces.
Knowledge and innovation are the lynchpins of Asia’s future. They are key to creating the robust economies the region will need to compete and ensure its people a better quality of life. Investments in higher education ultimately underpin the knowledge and innovation driving higher incomes and economic growth.
The Asian Development Bank’s recent study “Asia 2050” finds that if Asian leaders make the right kind of policy choices, Asia could potentially account for more than half of global GDP by 2050, with an additional three billion Asians enjoying more widespread affluence.
As we have seen in Korea, making the right kind of policy choices means investing in education. Korea, along with Japan, North America and the OECD, already invests five to six percent of national GDP on higher education, research and development, and information and communications technology.
It is no surprise that in the most recent Global Competitiveness Report, Korea is ranked among the world’s top countries in higher education and training, technological readiness and innovation.
Investment in education is giving Korea and other nations a distinct competitive edge.
It is not enough to simply have colleges and universities churning out large number of graduates. While Asia is already home to the largest higher education systems globally - with some 40 million students enrolled in schools in the People’s Republic of China and India alone - the quality of the education that many students are receiving still needs improvement.
A recent McKinsey report on global labor markets found that only one-quarter of India’s engineering graduates and just 15 percent of its finance and accounting students are considered globally competitive. In the People’s Republic of China, this falls to just 10 percent of engineering students and 15 percent of finance and accounting graduates.
Is Asia producing the right kind of graduates? For many businesses across Asia, the answer is no. The lack of required technical skills remains one of the primary reasons posts go unfilled.
Against this backdrop, many developing Asian nations would stand to benefit by following Korea’s example.
Korea has shown us that building a labor force capable of supporting sustained growth requires that students receive the correct mix of quality skills and knowledge - not just degrees. Equipped with the right skills, the workforce can be flexibly deployed, achieve high productivity levels, work effectively with existing technology and engage in innovation.
Building the world-class universities to drive this change requires many things: a high concentration of talent, both in faculty and students; investment in infrastructure and research to entice high-level scientists and researchers; highly selective student admissions based on merit; and good governance that inspires leadership and encourages strategic vision, innovation and flexibility. Regional cooperation in education can also help raise university standards. This allows more networking among institutions and provides more learning opportunities, especially from regional world-class universities.
Again, Korea provides us with a good example.
Inviting top management from universities in developing Asia to strengthen academic programs through cooperation and collaboration - as Seoul National University recently did at its Seoul Asian Universities Forum, which included 24 universities from 12 Asian countries - is a solid start to producing the quality graduates that Asia needs.
I congratulate Seoul National University, and President Oh Yeon-cheon and his team for this initiative.
Korea has shown us that a knowledge economy is a strong economy. All of Asia can all benefit from that.
*The writer is vice president of the Asian Development Bank for Knowledge Management and Sustainable Development.
By Bindu N. Lohani