Eastern Market can be defined as the markets situated in the “far-east”, that is to say, the markets in the East Asian countries of China, Hong Kong, Japan, Taiwan, Korea and in certain South-East Asian economies such as Malaysia and Vietnam. The East Asian economies primarily have the feature of a mixed economic system where government ownership in certain key sectors and private enterprise exist hand in hand. This market structure of a controlled free market system and a stress towards the export-oriented sector incorporating the benefits of a globalized world have resulted in high growth rates for these economies and a rise in the general per capita incomes. The economies are now thus called “Tiger Economies” due to their vibrant and dynamic growth rates. It should be noted in this context that this increase in the prosperity of the economy have met with many protests for the rising inequality in incomes in these countries attributed to the growing displacement of unskilled labour.
Some of the key Eastern Markets would include:
China Market: The second largest economy in the world after the USA measured on a Purchasing Power Parity (PPP) basis. China is gradually phasing out the communist system of a totally planned economy and the number of private enterprises swelled to 4.98 million at the end of 2006. The move towards the market economy system have resulted system have resulted in large flows of Foreign Direct Investment (FDI) in the years raising the productive efficiency of the country with the GDP growing at 10.7% in 2007. Per capita disposable income which is one of the key indicators of transforming to a completely market-oriented economy stood at 11,759 renminbi for the urban households in 2006, a growth of 10.4%.
Japan Market: The Japanese economy can be characterized by close government-industry cooperation, a strong work-ethic and expertise over sophisticated technology that has helped Japan become a major exporter of electronic goods and equipments. Japan is however a developed economy and a member of the G-8 nations (Group of Eight rich nations) as well as a member of the United Nations. The industrial capacity of Japan has helped the economy achieve a significant comparative advantage in the production machine tools, electronic equipment and automobiles. The Tokyo Stock Exchange (TSE) is the second largest in the world after the New York Stock Exchange (NYSE) with existing market capitalization at around US $ 4trillion.
Taiwan Market: A part of China of the Republic of China having a similar economic structure of a mixed economy where the essential features of government administration in a planned economy exists with the profitability of the free enterprise system. However, there has been a structural shift in the economic system as there has been a shift from the agricultural sector to the services and industry sectors since the 1970’s. The share of the agricultural sector in the region’s Gross Domestic Product (GDP) fell from 40% in the early 1950’s to about 4% in 1989.The structural shift occurred from the tilt towards import substitution policies, export promotion measures, reliance on heavy industries to the present emphasis on high-tech capital intensive industries. However, the self-sufficiency in the agricultural sector persists and various tax incentives are present for the farmers.
Hong Kong Market: Although after the transfer or power in 1997 from the UK to the People Republic of China (PRC), it operates with a relatively high degree of autonomy. It maintains a highly capitalist economy built on a policy of free market, low rates of taxation and non-government intervention. In terms of GDP per capita and Gross Metropolitan Product, Hong Kong is the wealthiest urban centre in the PRC. The GDP per capita on a PPP basis exceed that of even many Western European countries.
Korean Market: The South Korean market structure functions mainly on capitalistic lines and has emerged as powerhouse in the Asian region. The Korean or South Korean economy puts heavy emphasis on foreign trade and is now a major global producer for automobiles, electronics, shipbuilding, semiconductors, mobiles and monitors.The South Korean model of encouraging the growth of large, internationally competitive companies through easy financing and tax incentives has led to the emergence and prominence of the family-controlled conglomerates which emerged as global corporations. The best examples of this would be Hyundai and Samsung.