Asia is becoming the world's economic centre with the two huge zones of China and India to be major mechanisms driving the global economy, says former Bank of Thailand governor Prasarn Trairatvorakul.
But risks lie ahead as major Asian economies such as Thailand become ageing societies, challenging governments to adjust their policies to match changing situations, he said.
Risks lie ahead for ageing Asian countries, says Mr Prasarn. APICHIT JINAKUL
"Although the Chinese and Indian economies remain volatile, I still believe that the economies of the two countries will remain strong in the long run and they will be the leading countries that help move the world economy," Mr Prasarn said.
By 2030, the economies of China and India are expected to account for one-third of the global economy, fixing the spotlight on Asia and its huge population.
As a result, trading and economic activities in the region will increase substantially while reliance on the West will drop.
"This means all economic activities will move to Asia, making the region the financial centre of the world," Mr Prasarn said.
"That would raise another question of whether the Asian region will be ready to be the world's economic and financial centre, and if yes, how sustainable it would be."
The region must be prepared to upgrade its standards in many aspects in order to move ahead with the changing world.
"The IUU is one of the classic issues that the world is asking about higher standards, and Thailand will have to meet those standards if it wants to trade with the world," Mr Prasarn said, referring to the country's yellow-card status over illegal, unreported and unregulated fishing.
"This is another lesson that Thailand should learn, that one business can involve many aspects of the economy as well as society."
As one of the growing Asian countries, Thailand has moved from being a less developed country to become a middle-income country with a rising economy. However, Thailand and other Asian countries are becoming ageing societies, which is a new challenge that several Asian governments are facing.
"The changing population aspect is another risk that we are facing and the governments should adjust themselves and their policies to meet that change," Mr Prasarn said.
He said the world population was expected to rise from 7 billion to 8 billion over the next 10 years and elderly people will account for a large proportion of more than 20% of the global population.
Mr Prasarn said the ageing population would have an impact on the policies of Asian governments as they need to take care of this group of people.
"In future, a certain amount of the governments' budgets will have to be allocated for these ageing people," he said.
He said governments would need to be well prepared on how to spend their budgets in order to balance the proportion to be used for social welfare and to allocate a certain amount for investment and other expenses to stimulate their economies.