"The first challenge of China's economic development was to overcome poverty. Now the nation is preparing for the second challenge -- achieving prosperity. Prosperity is based on productivity, which is rooted in innovation. Ultimately, China's objective is not to provide endless labor reserves to serve foreign nations, but to lift the remaining rural regions from poverty and to raise living standards in rapidly expanding cities.

Productivity improvements that are typical during the take-off -- for example, building basic infrastructure facilities, improving health -- are not sufficient to increase productivity at a more advanced stage, where productivity gains from these policies have already been exploited. In advanced economies, rising productivity means higher wages."

"With inflation at 13-year highs and economic expansion slowing, India's government has shifted gears, saying it is giving priority to subduing prices over boosting growth. To put back some of the shine on the economy, the government is seeking to crank up economic reforms as it heads into the final stretch of its mandate.

But the administration led by Singh faces a tough challenge to accomplish any 'big bang' reforms. The biggest-ticket item on the anvil is a government plan to raise as much as 10 billion dollars from selling up to a 10 percent stake in state-run BSNL, the nation's largest telephone company. The initial public offer would be India's largest and improve the government's fiscal position but faces huge opposition from BSNL's union."

"Indonesia's President Yudhoyono last week gave a rosy assessment of his government's performance over the past four years, setting the stage for a re-election bid next year. Yudhoyono forecast economic growth of 6.2 next year. But growth of six-plus percent, while high for Indonesia, is still well below the country's potential given its abundant natural resources -- palm oil, tin, nickel and coal -- and lags the pace seen in China and India.

Many of Yudhoyono's policies, particularly a focus on economic management and reform, have been welcomed by foreign investors, although red tape and worries about contracts has stalled new investment in the key mining and energy sectors. Despite better growth, many of the poor have seen little trickle-down benefit while being treated to an almost daily diet of news about corruption among the elite."

"The intra regional trade in South Asia remains around 5 percent of the total trade. The big question arises why the 95 percent trade of South Asia is with extra-regional partners? Currently, few things support the future robust growth of SAFTA in the region, at least in the short run. The most important economic reason for the current status is because of the small size, low per capita income and volume of GDP of the countries. This was perhaps altogether ignored before the creation of an ambitious trade agenda.

Unless the large population of the region reaches to the level of Middle Income Groups, aggregate demand would not rise substantially. At that stage, the market demand would rise and so the trade creation would take place. The second impediment for a successful FTA is the presence of high level of protection that prevails in South Asian economies. Last major hurdle is the exclusion of many sectors from trading arrangements."

"The outcomes of Cambodia's development have been mixed: extremely beneficial for economic growth, the ruling elite and crony capitalism, and less advantageous for the poor. The World Bank has reported that local corruption has impeded the country's development, particularly poverty reduction, but the real difficulty may be the porous state of Cambodia's economy.

Aid constituted more than 10% of gross national income in 2004, far more than the low-income country average of 2.8%. In 2006, the amount of aid reached $595 million. Cambodia is also a fast-growing economy, with annual economic growth at nearly 11% in 2006. But poverty has fallen at a rate of only 1% a year."

"Robust growth in China's infrastructure sector has been driven by the country's strong economic growth, encouraging demographics, rapid urbanization and motorization trends as well as increasing infrastructure upgrading needs. Since 1998, total expenditure on transport infrastructure has exceeded 5% of GDP, of which roads accounted for about 3.5% of GDP.

The sector's investment needs are expected to total more than $130 billion annually between 2006 and 2010. Financing future transport infrastructure investments and maintaining existing infrastructure is a challenge for China. It helps that the government is increasingly seeking private sector and foreign participation, particularly in road infrastructure financing, to bring its highway system up to international standards."

"About 87 percent of Bangladesh's population is still left out of the banking system despite the proliferation of the private sector banks over the last two decades. The Bangladesh Bank governor has urged the commercial banks to come up with 'innovative schemes' to widen their coverage and services. The poor coverage of banking services indicates rising social inequality.

This, too reflects that most of the people do not have 'enough disposable income' to save. The banks are also not offering any incentive to small savers. The banks should expand their operations to the rural areas for bringing more people under their coverage and help reduce exploitation of the poor loan-seekers from a section of micro-credit providers."

"Indonesia's construction sector faces many challenges in 2008. On top of expected weak demand, skyrocketing costs of raw materials, including steel and cement, which account for approximately 20 percent of an average project's cost structure, will squeeze margins of ongoing projects.

The sector is also likely to suffer from postponed infrastructure projects in 2009 as the Public Works Ministry is likely to see its original expenditure plan slashed to Rp 35.6 trillion from Rp 58.7 trillion due to budget constraints amid higher oil-related subsidies. Land clearance issues have also continued to plague construction companies with increased costs and delays."

"Foreign direct investment (FDI) in Vietnam has surged in recent years but actual disbursement remains low in some places, mainly due to delays in acquiring land. The gap between the disbursed and registered amounts is because it takes a long time for large projects to get off the ground.

The Foreign Investment Agency said its officials would travel around the country to check the status of FDI projects and help local authorities speed up work on those involving more than $50 million. The government hopes $10 billion will actually be disbursed this year."

"The time is appropriate for government NGOs, and local communities and non-profit to collaborate more effectively and start working together towards a cleaner Dhaka, and to protect wetlands in and around Dhaka from the pressure of development to ensure biodiversity. It is of utmost importance for the economy and environment to save the wetlands, marshes, and bogs in inland or coastal areas.

Without growing public consciousness and compliance/enforcement of environmental regulations, Bangladesh could lose most of its critical wetland systems to unplanned urban development projects. Of particular concern are the Ashulia and Kaliakoir areas. There will be dire environmental consequences if important wetland areas such as the above are turned into commercial areas like Tejgaon."

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