The Future Is Asian

by Parag Khanna

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  Contents

  Introduction: Asia First

  1. A History of the World: An Asian View

  2. Lessons of Asian History—for Asia and the World

  3. The Return of Greater Asia

  4. Asia-nomics

  5. Asians in the Americas and Americans in Asia

  6. Why Europe Loves Asia but Not (Yet) Asians

  7. The Return of Afroeurasia

  8. The New Pacific Partnership

  9. Asia’s Technocratic Future

  10. Asia Goes Global: The Fusion of Civilizations

  Epilogue: Asia’s Global Future

  Acknowledgments

  About the Author

  Notes

  Bibliography

  Illustration Credits

  Index

  FOR MY FIVE BILLION NEIGHBORS

  Introduction: Asia First

  When did the Asian century begin?

  Forecasts of Asia’s rise to global preeminence go back two centuries to Napoleon’s alleged quip about China: “Let her sleep, for when she wakes she will shake the world.”

  Nearly a century ago, in 1924, the German general Karl Haushofer predicted a coming “Pacific Age.” But Asia is much more than the countries of the Pacific Rim. Geographically, Asia stretches from the Mediterranean and Red Seas across two-thirds of the Eurasian continent to the Pacific Ocean, encompassing fifty-three countries1 and nearly 5 billion people—only 1.5 billion of whom are Chinese. The Asian century will thus begin when Asia crystallizes into a whole greater than the sum of its many parts. That process is now underway.

  When we look back from 2100 at the date on which the cornerstone of an Asian-led world order began, it will be 2017. In May of that year, sixty-eight countries representing two-thirds of the world’s population and half its GDP gathered in Beijing for the first Belt and Road Initiative (BRI) summit. This gathering of Asian, European, and African leaders symbolized the launch of the largest coordinated infrastructure investment plan in human history. Collectively, the assembled governments pledged to spend trillions of dollars in the coming decade to connect the world’s largest population centers in a constellation of commerce and cultural exchange—a new Silk Road era.

  The Belt and Road Initiative is the most significant diplomatic project of the twenty-first century, the equivalent of the mid-twentieth-century founding of the United Nations and World Bank plus the Marshall Plan all rolled into one. The crucial difference: BRI was conceived in Asia and launched in Asia and will be led by Asians.

  This is the story of one entire side of the planet—the Asian side—and its impact on the twenty-first-century world.

  For most of recorded history, Asia has been the most important region of the globe. As the late British economist Angus Maddison demonstrated, for the past two thousand years, until the mid-1800s, China, India, and Japan together generated a greater total gross domestic product (GDP) (in purchasing power parity, or PPP, terms) than the United States, United Kingdom, France, Germany, and Italy combined. But with the Industrial Revolution, Western societies modernized their economies, expanded their empires, and subjugated most of Asia. After two centuries of Europe ruling the world, the United States rose to become a global power through its victory in the Spanish-American War (which gave it control of Cuba and the Philippines) and its decisive role in ending World War I.

  But only after World War II—when Western powers stopped trying to conquer one another—did a stable Western order emerge. It was embodied in US military and economic power, the transatlantic North Atlantic Treaty Organization (NATO) alliance, and international institutions such as the United Nations, World Bank, and International Monetary Fund (IMF). Seventy years ago, nobody knew how enduring those agreements and bodies would be—especially as the Cold War divided much of the world. Only at the end of the Cold War could the West be confident in the triumph of its liberal, democratic, capitalist system. And only in the 1990s did the world order become truly global as numerous former Soviet republics joined the European Union and NATO, while dozens of developing countries joined bodies such as the World Trade Organization (WTO) that promoted what was known as the “Washington Consensus” of free trade and economic deregulation. Western laws, interventions, money, and culture set the global agenda.

  But the nearly two decades spanning the September 11, 2001, terrorist attacks and the 2003 Iraq War through the 2007–08 financial crisis to the November 2016 election of Donald Trump as US president will be remembered as a period of profound rupture with the previous decades of Western dominance. The failures of the Afghanistan and Iraq wars, the disconnect between the financial (Wall Street) and real (Main Street) economies, the inability to integrate Russia and Turkey into the West, and democracy hijacked by populists—these are among the salient episodes that have brought many Western elites to question the future of their political, economic, and social values. Today Western societies are consumed with domestic ills: mounting debt, rising inequality, political polarization, and culture wars. American millennials have grown up with a war on terror, declining median income, mounting racial tension, arbitrary gun violence, and political demagoguery. European youths struggle with economic austerity, high unemployment, and out-of-touch politicians. The West has pioneered wondrous technological advances from communications to medicine, but its populations have not enjoyed the benefits evenly.

  As the West was fighting and winning the Cold War, Asia began to catch up. Over the past four decades, Asians have gained the greatest share of total global economic growth and Westerners, especially middle-class industrial workers, the least—a trend driven by the rise of manufacturing in Asia.2 Billions of Asians growing up in the past two decades have experienced geopolitical stability, rapidly expanding prosperity, and surging national pride. The world they know is one not of Western dominance but of Asian ascendance. In 1998, my Singaporean colleague Kishore Mahbubani published a provocative collection of essays titled Can Asians Think? warning Westerners that the global tide was turning and that Asia has as much to teach the West as the reverse.3 As Asians come to adopt some semblance of a common worldview, it is time to explore not if Asians can think but what they think.

  Asians once again see themselves as the center of the world—and its future. The Asian economic zone—from the Arabian Peninsula and Turkey in the west to Japan and New Zealand in the east, and from Russia in the north to Australia in the south—now represents 50 percent of global GDP and two-thirds of global economic growth.4 Of the estimated $30 trillion in middle-class consumption growth estimated between 2015 and 2030, only $1 trillion is expected to come from today’s Western economies. Most of the rest will come from Asia.5 Asia produces and exports, as well as imports and consumes, more goods than any other region, and Asians trade and invest more with one another than they do with Europe or North America. Asia has several of the world’s largest economies, most of the world’s foreign exchange reserves, many of the largest banks and industrial and technology companies, and most of the world’s biggest armies. Asia also accounts for 60 percent of the world’s population. It has ten times as many people as Europe and twelve times as many people as North America. As the world population climbs toward a plateau of around 10 billion people, Asia will forever
be home to more people than the rest of the world combined. They are now speaking. Prepare to see the world from the Asian point of view.

  What Is Asia?

  Halfway through his decadelong mission to circumnavigate the planet on foot following the paths of the earliest humans, I reached the National Geographic explorer Paul Salopek as he was crossing the Pamir Mountains in Kyrgyzstan. A modern Marco Polo (and then some), Paul has been showered with literary accolades (including two Pulitzer Prizes) for his reportage. But his current Out of Eden Walk is his most ambitious undertaking, something few if any have attempted before and none has completed. With so much of Asia behind him—and so much still ahead—I sought his assessment of the region. He told me, “Asia is so huge and complex that I feel like I’m moving through a vast mosaic of microworlds, loosely knitted together by forces beyond my ken.” This tangible yet spiritual description elegantly captures Asia’s combination of enormous size and mystical unity.

  Most people literally don’t understand what Asia is—even in Asia. Asia’s vastness and range of self-contained civilizations, combined with a recent history dominated by Western or internal concerns, has meant that most Asians today have contrasting views of the parameters of Asia and the extent to which their nations belong to it.6 Yet even though Asia is the most heterogeneous region of the world, there is a growing coherence in its dizzying diversity: some psychological underpinning, some aesthetic familiarity, some cultural thread that permeates Asia and differentiates it from other regions.

  From kindergartens to military academies, Asia is still mistakenly referred to as a continent even though it is strictly speaking a megaregion stretching from the Sea of Japan to the Red Sea.7 Asia contains half of the world’s largest countries by land area, including Russia, China, Australia, India, and Kazakhstan.8 Asia also has most of the world’s twenty most populous countries, including China, India, Indonesia, Pakistan, Bangladesh, Japan, the Philippines, and Vietnam. Asia is home to some of the wealthiest countries in the world on a per capita basis, such as Qatar and Singapore, but also some of the smallest (Maldives, Nauru), least populous (Tuvalu, Palau), and poorest (Afghanistan, Myanmar).

  “Asia” is first and foremost a geographic descriptor. We often impose convenient but false geographic labels that suit our biases. In recent decades, Russia, Turkey, Israel, and the Caucasus countries have all sought to brand themselves as culturally and diplomatically Western states (and group themselves with Europe at the United Nations). But just because Russians and Australians hail (mostly) from European races does not mean they cannot be Asian. Even through an ethnic lens, Russians and Aussies should be seen—and see themselves—as white Asians. Many experts hold “Asia” to be synonymous with “Far East.” But Asia cannot be narrowly defined as just China and East Asia. China borders other major Asian subregions, but it does not define them. Hence we should use the term “East Asia” when referring to the Pacific Rim. After all, it is particularly odd for Americans to use the term “Far East” since the region lies to their west across the Pacific Ocean. “East” should therefore be used as a relative directional orientation and “Asia” as a geographic region. Similarly, it remains all too common to use “Middle East” to connote everything from Morocco to Afghanistan, spanning a melange of subregions stretching from North Africa to Central Asia. (Even Al Jazeera International’s anchors use the term “Middle East”—because they are speaking English.) But North African countries from Egypt westward have little relevance to Asia, even though they are mostly Arab populated. It makes far more sense to refer to West Asia and Southwest Asia to capture Turkey, Iran, the Gulf states, and the nations lying between them. Neutral geographic labels are ultimately much more revealing than colonial artifacts.

  Asia for Asians

  More than two millennia ago, Asia’s disparate civilizations had already established commercial ties and engaged in conflict from the Mediterranean and Caspian seas to the Indus valley. By the fifteenth century, Asia was a diplomatically, economically, and culturally connected realm stretching from Anatolia to China. European colonialism, however, fractured Asia, reducing it to a collection of adjacent territories too poor and subservient to Western powers to congeal meaningfully. The Cold War further splintered Asia into competitive spheres of influence. Over time, Arabs and Turks came to see themselves as the “Middle East” and Chinese and Japanese identified as the “Far East.” Asia ceased to be a coherent whole.9

  After two centuries of division, today’s post–Cold War period marks the advent of a new phase of Asia knitting itself back together into a coherent system. A system is a collection of countries that are bound together not only by geography but also by the forces of diplomacy, war, and trade. The members of a system are all sovereign and independent but also strongly interdependent with one another in matters of economics and security. A system is formed through alliances, institutions, infrastructure, trade, investment, culture, and other patterns. When nations graduate from common geography into meaningful interactions, a system is born.

  As the British scholar Barry Buzan elucidates in International Systems in World History, human history is to a large degree the stories of disparate regional systems.10 The ancient city-states of Mesopotamia, the Delian League led by Athens, and the Warring States of China are all examples of small-scale systems. By contrast, empires such as the Mongol and British governed large regional and international systems. Only in recent centuries has a global system emerged, but to a large degree this consists of the relations among numerous regional systems—with Europe, North America, and Asia being the most important.

  Europe today is the most integrated regional system. From the ashes of World War II, European countries not only rebuilt physically but fused important industries through the European Coal and Steel Community. Back then, nobody knew that the original half-dozen members—including rivals France and Germany—would expand to nearly thirty members with supranational institutions and a common currency and even build joint military capabilities. Europe today is far more powerful as a system than merely as a region.

  North America is the next most integrated system. The United States, Canada, and Mexico are strategic partners and among one another’s top trading partners as well.11 They also have by far the two busiest border crossings in the world. Even as the more-than-two-decades-old North American Free Trade Agreement (NAFTA) is renegotiated, the broader economic, demographic, cultural, and other ties effectively make the region a North American union even if it never adopts that name.

  ASIA BUILDS ITS OWN DIPLOMATIC SYSTEM.

  Asian nations are rapidly building their own diplomatic bodies to coordinate, regulate, and govern issues such as trade, infrastructure, and capital flows. The Asian Infrastructure Investment Bank (AIIB) has nearly ninety members, and the Regional Comprehensive Economic Partnership (RCEP) is emerging as the world’s largest free-trade area by both GDP and trade volume.

  Despite its vast geography and cultural diversity, Asia is evolving from faint historical and cultural linkages to robust economic interdependence to strategic coordination. In 1993, the Japanese scholar and journalist Yoichi Funabashi wrote a prescient essay in Foreign Affairs about the “Asianization of Asia.”12 He spoke of a new regional consciousness, one not focused on backward-looking anticolonialism but rather proactively responding to American Cold War triumphalism and Europe’s single market. Globalized competition, he rightly argued, would require Asia to Asianize, beginning with the “chopsticks” civilizational area encompassing China, Japan, South Korea, and Vietnam and eventually reaching beyond to reforming countries such as India. Funabashi believed that the combination of economic growth, geopolitical stability, and technocratic pragmatism would give rise to distinctly Asian ideas about world order.

  That time has come. The same ingredients of industrial capitalism, internal stability, and search for global markets that propelled Europe’s imperial ascendancy and the United States’ rise to superpower status are converging i
n Asia. In just the past few years, China has surpassed the United States as the world’s largest economy (in PPP terms) and trading power. India has become the fastest-growing large economy in the world. Southeast Asia receives more foreign investment than both India and China. Asia’s major powers have maintained stability with one another despite their historical tensions. They have formed common institutions such as the Asian Development Bank (ADB), ASEAN Regional Forum, East Asian Community (EAC), Regional Comprehensive Economic Partnership (RCEP), and Asian Infrastructure Investment Bank (AIIB)—all of which facilitate flows of goods, services, capital, and people around the region and will steer trillions of dollars of financing into cross-border commercial corridors. A quarter century after the United States won the Cold War and led the Asian order, it is now excluded from nearly all of these bodies.

  East and South Asia’s rise has compelled West Asia to rediscover its Asian geography. My grandfather, a veteran Indian civil servant and diplomat, always referred to the Gulf states as “West Asia”—never the “Middle East.” This seems ever more appropriate as the Gulf petromonarchies trade far more with other Asians than with the West.13 In fact, in the late 1990s, Arab oil producers began to lock in long-term contracts with energy-thirsty Asian powers the way they used to with Europe and America. With East and South Asians driving global economic growth and West Asians reorienting toward them, the Asian failed states in between such as Iraq and Afghanistan are also closing their chapters of US occupation and plotting their futures within the Asian system.

  THINK PPP FOR GDP: ASIANS PAY ASIAN PRICES FOR ASIAN GOODS.

  Measured in PPP terms, China has already surpassed the United States as the world’s largest economy, while Asia as a whole represents about half of global GDP. The more Asian economies trade with one another, the better able they are to maintain low prices for goods.