The document provides an overview of the origins and history of the Asian Productivity Organization (APO) and the Asian productivity movement over the past 50+ years. Some key points:
- The APO was established in 1961 with 8 founding members to promote productivity across Asia through cooperation and human resource development.
- Milestones over the decades include the establishment of national productivity organizations, expansion of APO membership, and a shift toward addressing emerging issues like green productivity, SMEs, and ICT.
- Today the APO has 20 member countries and works through national productivity organizations to deliver capacity building programs and research to support members' economic development goals.
2. • After completing Module 1, you should have a better
appreciation of productivity, quality and competitiveness
concepts.
• In this module you will realize that at the country or regional
level, productivity has indeed become a movement in Asia
since the early 1950’s.
• Productivity as a national movement led to Japan’s
economic prosperity and better quality of life of its people.
• The importance of productivity as a strategy to help
accelerate economic development of countries in the Asia
Pacific Region, has led to the establishment in 1961 of the
Asian Productivity Organization (APO) which to date still
spearheads the Asian productivity movement.
Module 2 – Background of the
Asian Productivity
Movement
Introduction
3. • This module also presents a glimpse of the milestones of the
APO’s history in the last 5 decades largely from a macro
perspective.
Milestones of the individual APO member countries’ productivity
movement as well as their economic growth and productivity
growth performance, however, are not covered here.
• You will note that to sustain the productivity movement, current
and emerging challenges, among which are cited here, need to be
addressed to enhance socio-economic growth and competitiveness
in the APO region.
• The learnings are important in your journey towards becoming a
productivity practitioner and in sustaining the productivity
movement.
Module 2 – Background of the
Asian Productivity
Movement
Introduction
4. At the end of the module, participants will be able to:
1. Describe the origins of the Asian productivity movement
highlighting the establishment of the Asian Productivity
Organization (APO).
2. Cite key milestones of the APO in the last 50 years as
spearhead of the Asian Productivity Movement.
3. Explain the Economic Growth and Productivity Trends of
APO member countries (APO 20) in the last 50 years (1961-
2011) based on APO Research.
Module 2 – Background of the
Asian Productivity
Movement
Learning Objectives
5. • Based on historical accounts the seed of the movement sprouted in
1953 when the Americans proposed to extend technical aid
program for higher productivity to Japan. This was part of US
assistance to help Japan’s economy recover after World War II.
• Japan subsequently established the Japan Productivity Center (JPC)
in 1955 with the support of leading business organizations to
promote national productivity starting with the industry sector
particularly in manufacturing.
• Initially the Japanese Trade Unions and even Japanese management
were suspicious of the productivity movement.
• The Japanese Productivity Movement took roots only after an
intensive education campaign and the adoption of the three (3)
guiding principles of the productivity movement.
I. ORIGINS OF ASIAN PRODUCTIVITY MOVEMENT:
_____________
Jinnosuke Miyai, “Origins of Productivity Movement and Formation of Japan Productivity Center” in
Changing Productivity Movement: Challenges and Lessons, APO 1999.
6. It is well known that Japan eventually became a very productive and
competitive nation because of the productivity and quality performance
particularly of its industries. The Japanese productivity movement were
guided by three major principles:
1. Principle of Improvement in Quality of Work Life
In the long run improvement of productivity will increase
employment and consequently enhance the quality of work life.
2. Principle of Labor-Management Cooperation
In developing concrete measures to increase productivity, labor
and management must cooperate in discussing, studying and
deliberating such measures.
3. Principle of Fair Distribution
The fruits of improved productivity must be distributed fairly
among management, labor and the consumers.
Principles of the Productivity Movement
7. • In 1955 the Americans also helped set up the China Productivity Center
(CPC) and later on helped set up the Industrial Development Center in the
Philippines
• From 1955 to 1959 many Asian Countries also established their own
productivity centers/bodies like:
− National Productivity Council India
− Nepalese Industrial Development Center
− Ceylon Institute of Scientific and Industrial Research
− Pakistan Industrial Development Center
− Korean Productivity Center
− Thailand Productivity Agency
− Indonesian Institute of Productivity
• By late 1950’s several countries led by Japan recognizing the importance of
productivity for accelerating economic development, held round table
meetings to bond together to jointly establish a regional body to promote
productivity in Asia and the Pacific. This was subsequently known as the
Asian Productivity Organization (APO).
I. ORIGINS OF ASIAN PRODUCTIVITY MOVEMENT:
8. The Asian Productivity Organization (APO) is an
intergovernmental regional organization established by
Convention in 1961 to increase productivity in the countries of
Asia and the Pacific through mutual cooperation and human
resource development. It is nonpolitical, nonprofit making and
nondiscriminatory.
Membership
The founding signatories to the APO Convention in 1961 were
eight (8) countries which included: the Republic of China,
India, Japan, Republic of Korea, Nepal, Pakistan, Philippines,
and Thailand.
The ASIAN PRODUCTIVITY ORGANIZATION
9. Membership
• The following countries joined APO subsequently.
• Currently APO has a total of Twenty (20) member countries.
• Hongkong 1963 • Bangladesh 1982
• Iran 1965 • Malaysia 1983
• Vietnam 1965 • Fiji 1984
• Sri Lanka 1966 • Mongolia 1992
• Indonesia 1968 • Lao PDR 2002
• Singapore 1969 • Cambodia 2004
The ASIAN PRODUCTIVITY ORGANIZATION
10. 20 MEMBER COUNTRIES (APO 20) ARE GEOGRAPHICALLY
LOCATED IN 3 REGIONS OF THE WORLD
The ASIAN PRODUCTIVITY ORGANIZATION
11. The ASIAN PRODUCTIVITY ORGANIZATION
What is the Mission of APO?
Thru
Enhancing Productivity
of sectors of economy
APO
Support MCs
Economic
Development of
Member Countries
12. The ASIAN PRODUCTIVITY ORGANIZATION
How APO is Pursuing its Mission?
Increase National Productivity
Service Sector
APO Capacity Building Programs
14. FIVE KEY ROLES OF THE APO
In serving its member countries, the APO performs five key
roles:
1. As a Think Tank to develop productivity programs
2. As a Catalyst to promote cooperation to enhance
productivity
3. As a Regional Adviser on productivity programs to
support economic and development goals
4. As an Institution Builder to strengthen capabilities of
NPOs.
5. As a Clearinghouse to disseminate information on
productivity
15. APO ORGANIZATION STRUCTURE
Governing Body
Secretary-General
Administration
& Finance
Department
Research
& Planning
Department
Industry
Department
Agriculture
Department
•Annual APO Workshop Meeting of Heads of NPOs (October)
•Annual APO Governing Body Meeting (April)
WSM
National
Productivity
Organizations
APO Secretariat
16. The APO works with designated National Productivity
Organizations (NPOs) in member countries
• The NPOs are either statutory bodies, government
departments or private bodies.
• The focus of the NPOs is to promote and develop the national
productivity movement, implement capability building
projects, conduct research studies to address current and
emerging issues and disseminate information on productivity
and best management practices.
• The NPOs relates with the APO Secretariat, other NPOs and
partner institutions.
ABOUT THE NPOs
17. • Institutional Set-up
Statutory bodies
ROC, Fiji, India, ROK, Malaysia, Pakistan, Philippines,
Singapore, Thailand, and Vietnam
ABOUT THE NPOs
18. • Institutional Set-up
Government departments
Bangladesh, Cambodia, Indonesia, IR Iran, Lao PDR, and Sri
Lanka
Private bodies
Japan, Mongolia, Nepal
ABOUT THE NPOs
19. • 1961 – 1970 (Decade of Establishment)
1961 • The APO was formally established with eight founding
members: Republic of China, India, Japan, Republic of Korea,
Nepal, Pakistan, the Philippines, and Thailand.
• The inaugural session of the APO Governing Body is held in
Tokyo and the 1st APO Secretary General is appointed.
• Technical Expert Services (TES) started and the monthly
newsletter Asian Productivity is launched.
1962 • The 1st Conference of Productivity Center Directors is held in
Kathmandu, Nepal and Technical Enquiry Services start.
1963 • Symposia and seminars are introduced in the lineup of APO
programs; the first Symposium on Top Management is held.
• A Study Mission is sent outside Asia to the USA, the UK, and
Denmark, Hong Kong joins APO.
II. MILESTONES IN THE APO’s HISTORY
Based on APO data the major contributions of the APO as spearhead of the
Asian Productivity Movement can be seen over 5 decades as follows:
20. • 1961 – 1970 (Decade of Establishment)
1964 • A reciprocal relationship agreement with the International
Labor Organization is signed. A Small Management Trainers
and Consultants Course grant is given by the Ford
Foundation.
1965 • The Republic of Vietnam and Iran join the APO.
• The APO quarterly publication Productivity Digest is
launched.
1966 • Ceylon (later Sir Lanka) joins the APO.
• The Agriculture Program is launched.
1967 • Agreement with the government of Japan granting the APO
official status as international organization is signed. The
1st APO Five-Year Plan Meeting is held in Hong Kong.
II. MILESTONES IN THE APO’s HISTORY
21. • 1961 – 1970 (Decade of Establishment)
1968 • Indonesia joins APO
1969 • The 1st APO- Five Year Plan is launched.
• The APO Regional Information Unit is established in
Manila, the Philippines, Singapore joins the APO.
1970 • The APO’s 10th Anniversary declared “Asian Productivity
Year.”
• The 1st Asian Productivity Congress is held in Tokyo and the
Declaration on Productivity for the Asian Region is adopted.
II. MILESTONES IN THE APO’s HISTORY
22. • 1971 – 1980 (Decade of Consolidation)
1971 • APO past activities are reviewed and new projects
identified by economists and productivity specialists.
• A commercial publication program is launched and sales of
APO books through a network of international distributors
starts.
1972 • The 1st Expert Meeting on Productivity Measurement is
held to develop a framework for examining the relationship
between economic development and total factor
productivity.
• First financial grants are received from the ADB and USAID.
1973 • The 1st Workshop on Productivity Measurement is held in
Singapore
II. MILESTONES IN THE APO’s HISTORY
23. • 1971 – 1980 (Decade of Consolidation)
1974 • The Research and Planning Program is launched, linking by
research areas with APO programs.
1975 • A policy for institutional capacity building of NPOs and
focus on micro or enterprise level productivity is adopted
by the 17th Governing Body.
1976 • The importance of technology in economic development is
underscored in APO activities.
• Non-ESCAP member participation is welcomed in APO
projects with a special grand fund from Japan.
• The APO flag design contest is won by Nepal’s S. D. Ashanta.
1977 • The APO awards are established to honor individuals both
within and outside the APO who have made outstanding
contribution to the cause of Asian productivity.
II. MILESTONES IN THE APO’s HISTORY
24. • 1971 – 1980 (Decade of Consolidation)
1978 • The Bilateral Cooperation between National Productivity
Organizations (BCBN) Program begins.
• The APO’s 1st Roster of Asian Experts is complied to
facilitate selection of experts for the TES Program.
1979 • The Governing Body confers the 1st APO Awards on nine
distinguished individuals for their contribution to the
productivity movement. Marked the improvement in
project quality are seen after participants evaluation of
training is introduced.
1980 • The APO marks its 20th anniversary.
• The 2nd Asian Productivity Congress is held in Hong Kong.
• A special fund to support specific needs of member
countries is created.
II. MILESTONES IN THE APO’s HISTORY
25. • 1981 – 1990 (Decade of Expansion)
1981 • Promoting closer links between productivity and economic
growth becomes a focus.
1982 • Bangladesh joins APO.
1983 • Malaysia joins the APO.
1984 • Fiji joins the APO.
1985 • The APO awards are renamed “APO Regional Award”; the
APO National Award is introduced.
1986 • The APO’s 25th Anniversary is marked with an International
Productivity Conference in Kuala Lumpur, Malaysia.
II. MILESTONES IN THE APO’s HISTORY
26. • 1981 – 1990 (Decade of Expansion)
1987 • The Productivity Fellowship is launched.
1988 • The 1st Strategic Planning Committee meeting is hosted by
the APO.
1989 • The Strategic Planning Committee recommendation to
institute a new system for categorizing APO programs by
type of eligible participants is adopted by the 31st GBM.
Basic research on human resources development is
conducted.
1990 • APO projects are reclassified into nine thematic categories,
three each for the Industry and Services, Agriculture Sector,
and Interface Sector. A symposium on Tripartism is hosted
by the State of Western Australia (observer as of 1989)
II. MILESTONES IN THE APO’s HISTORY
27. • 1991 – 2000 (Decade of Leadership)
1991 • The APO 30th Anniversary is marked with an International
Productivity Congress in Bangkok, Thailand. The Bangkok
Declaration on Productivity for Better Quality of Work Life
is adopted.
1992 • Mongolia joins the APO.
1993 • A grant is given by the Government of Japan to start a fund
for Nonmember Assistance, enabling the APO to provide
more training opportunities.
1994 • The Special Program for the Environment starts (later called
Green Productivity Program).
1995 • The South-South Cooperation for Supporting Industry
Assistance Program is launched.
II. MILESTONES IN THE APO’s HISTORY
28. • 1991 – 2000 (Decade of Leadership)
1996 • Vietnam joins the APO.
• The APO initiates the Integrated Community (ICD) Program
for rural development; holds the APO World Conference on
Green Productivity in Manila, the Philippines.
• The Manila Declaration on Green Productivity is adopted.
1997 • The APO signs a Memorandum of Understanding with the
United Nations Environment Program (UNEP) Industry and
Environment Programme Activity Center.
1998 • Links are established with the Asia Pacific Round Table on
Cleaner Production, UNEP, US-Asia Environment
Partnership, and Carl Duisberg Gesellschaft.
II. MILESTONES IN THE APO’s HISTORY
29. • 1991 – 2000 (Decade of Leadership)
1999 • APO activities in IT are strengthened and two thrusts areas
for APO programs are added: Small and Medium
Enterprises and ICD.
2000 • The 1st external evaluation of APO projects is conducted by
independent experts; a bimonthly Japanese edition of the
APO News is published; the Secretariat moves to Chiyoda-
Ku, Tokyo.
II. MILESTONES IN THE APO’s HISTORY
30. • 2001 – 2010 (Decade of Innovation)
2001 • The APO 40th Anniversary is marked with the first
International Conference on Productivity in the e-Age in
New Delhi, India.
• The International Forum for Small and Medium Enterprises
is held in New Delhi, also commemorating the 40th
Anniversary.
• APO International Productivity Conference held in
Singapore hosted by PSB Singapore.
2002 • The 2nd World Conference on Green Productivity is held in
Manila, the Philippines.
• Lao PDR joins the APO.
• The APO website www.apo-tokyo.org is launched.
2003 • The 1st APO e-learning course is held.
II. MILESTONES IN THE APO’s HISTORY
31. • 2001 – 2010 (Decade of Innovation)
2004 • The first eco-products International Fair (EPIF) organized by
the APO is held in Kuala Lumpur, Malaysia.
• Cambodia joins the APO.
• The APO adopts the One Village, One Product movement as
part of tis ICD Program.
• The APO joins the World Summit on Sustainable
Development in Johannesburg, South Africa.
2005 • The 2nd EPIF is held in Bangkok, Thailand. The APO Regional
Award is conferred on four individuals and the APO
National Award on 10.
2006 • After a productivity conference in Sandton, South Africa,
cooperation with the Pan African Productivity Association
takes off. Singapore hosts the 3rd EPIF. The APO adopts
Community-based Rural Tourism as part of the ICD
Program.
II. MILESTONES IN THE APO’s HISTORY
32. • 2001 – 2010 (Decade of Innovation)
2007 • An International Productivity Conference in Bangkok, Thailand,
focuses on knowledge management. Co-sponsored by FAO,
the APO organizes the Southeast Asian Regional Conference on
Agricultural Value Chain Financing in Kuala Lumpur.
2008 • An Observational Study Mission is sent to Switzerland on
Quality and Innovation with JETRO support.
• The 1st self e-learning course on the Balance Scorecard starts.
• The APO conducts a Study Mission to a Nonmember Country
(France) on Export Promotion and Market Access for Processed
Agrifood Products.
• The 4th EPIF in Hanoi attracts nearly 100,000 visitors.
• The first edition of the APO Productivity Databook series is
published.
• The 1st Asia-Pacific Forum on Sustainable Production of
Biofuels is held in the Philippines.
• In-country training programs for strengthening the NPOs are
started.
II. MILESTONES IN THE APO’s HISTORY
33. • 2001 – 2010 (Decade of Innovation)
2009 • The APO participates in a Conference on the Global
Economic Crisis in Taiwan, Republic of China.
• A Study Mission to a Nonmember Country on Exporting
Processed Agrifood Products is held in Germany.
• Asian Quarterly Growth Map is launched.
• Manila hosts the 5th EPIF.
2010 • Study missions on modern agriculture are sent to Germany
on GLOBALGAP and the USA on Innovations in Food
Products.
• New Secretary-General Ryuichiro Yamazaki is appointed,
replacing outgoing Secretary-General Shigeo Takenaka.
• Jakarta hosts the 6th EPIF.
II. MILESTONES IN THE APO’s HISTORY
34. • 2011 – Present
2011 • The APO’s 50th anniversary is marked with a new vision,
mission and strategic directions for 2011 to 2020.
• 5 APO Regional and 7 National Awardee are named,
including Fidel V. Ramos, 12th President of the Republic of
the Philippines.
• New Delhi hosts the 7th EPIF.
• The 27th Top Management Forum is held in Kyoto, tackling
Asian Dynamism and Global Management.
• The APO e-Learning Program is re-launched with a
certificate-based learning e-course on the Occupational
Health and Safety Management System.
Source:
50 Years of the Asian Productivity Organization Golden Jubilee 1961-2011
Asian Productivity Organization, 2011, 34 pp.
II. MILESTONES IN THE APO’s HISTORY
35. SOME LESSONS FROM THE ASIAN
PRODUCTIVITY MOVEMENT
Key factors for the success and sustainability of the Asian Productivity
Movement are:
• Link to National Economic Development Plans and Priorities
• Strong government commitment and sustained partnership and
support from the private business sector
• Importance of Promotion/Awareness Campaign especially through
mass media
• Good working relationship with Industry, Trade Unions and
Academia
• Institutional Mechanism/Infrastructure to sustain the movement
• Importance of Human Resource Development
• Customer-Driven Approach
• Total Approach to Productivity
• International Cooperation
• Commitment and support of all stakeholders
36. III. GLIMPSE OF ECONOMIC GROWTH AND
PRODUCTIVITY TRENDS IN THE APO
REGION IN THE LAST 50 YEARS (1961-
2011)
• This Module provide a glimpse of the economic growth
and Productivity Trends in the APO Region (APO 20)
based on an APO Research (Productivity in Retrospect)
in 2011. (Research Results to be published by APO).
• Data were primarily based on the Summary of Findings
of the APO Research (unpublished) made by Chief Expert
Dr. Tsu Tan Fu of R.O.C.
37. Geographic Location: APO 20
The 20 APO member countries are located in three regions:
1. East Asia & Pacific: (14)
North East Asia: ROC, ROK, Hongkong, Japan and
Mongolia
Southeast Asia: Cambodia, Lao PDR, Indonesia,
Malaysia, Philippines, Singapore,
Thailand and Vietnam
Pacific: Fiji
2. South Asia: (5)Bangladesh, India, Nepal, Pakistan, and
Sri Lanka
2. Middle East: (1) Iran
38. Country Statistics: APO 20
• The APO 20 have diversity in natural endowment and
development stage.
• Natural Endowment: (top 5 countries in 2010)
– Population: India, Indonesia, Pakistan, Bangladesh,
Japan
– Country size: India, Indonesia, Iran, Mongolia, Pakistan
• Development Stage (GDP per capita in 2010):
– 20,000 USD: 4 tigers and Japan
– 7,000 USD: Malaysia , Iran, Thailand
– Less 7,000USD: others
40. APO20 IS LOCATED IN THE THREE FASTEST
GDP GROWING REGIONS OF THE WORLD
1961-2010 Avg. Real GDP Growth
2.7
2.7
2.7
2.8
3.1
3.4
3.7
4.2
5.0
5.2
0 2 4 6
OECD members
Europe & Central Asia
European Union
North America
World
Sub-Saharan Africa (all income levels)
Latin America & Caribbean
Middle East & North Africa
East Asia & Pacific (all income levels)
South Asia
%
Avg.
unit: %
42. GDP Growth in the Asia-Pacific Region
• In the past 50 years (1961-2010): the
average GDP growth rate is 5% for South
Asia and East Asia & Pacific, and 4% for
Middle East & North Africa.
• These growth rates are greater than avg. of
OECD members (2.7%), European Union
(2.7%) and the World average (3.1%).
• East Asia & Pacific led the growth in 1960s
and 1970s, whereas South Asia became
growth leader in 1980s-2000s.
44. In 1961-2010 APO20 (EXCEPT FIJI) PERFORMED
BETTER THAN OECD, EU (2.7) AND WORLD (3.1)
1961-2010 Avg. Real GDP Growth
2.9
3.6
3.7
3.7
3.9
4.0
4.6
4.9
5.2
5.4
5.5
5.7
6.1
6.2
6.3
6.6
6.6
7.1
7.4
7.6
0 2 4 6 8
Fiji
Nepal
Mongolia
Bangladesh
Philippines
Japan
Sri Lanka
Iran
Pakistan
Indonesia
India
Lao PDR
Thailand
Malaysia
Vietnam
Hong Kong SAR, China
Korea, Rep.
ROC
Cambodia
Singapore
%
Avg.
unit: %
45. IN THE 1960s IRAN, JAPAN AND 4 TIGERS
PERFORMED THE BEST AMONG APO20
1961-1970 Real GDP Growth
2.5
3.9
4.0
4.5
4.8
5.0
6.2
6.3
7.0
7.8
7.9
9.3
9.3
9.5
9.7
10.7
0 2 4 6 8 10 12
Nepal
Bangladesh
Indonesia
Sri Lanka
Philippines
Fiji
India
Malaysia
Pakistan
Thailand
Korea, Rep.
Singapore
Japan
ROC
Hong Kong SAR, China
Iran
%
1961-1970
unit: %
46. IN THE 2000s CAMBODIA, INDIA, VIETNAM, LAO PDR
AND MONGOLIA ARE GROWTH LEADERS:
THE CONVERGENCE IN INCOME HYPOTHESIS
2001-2010 Real GDP Growth
0.8
1.0
2.8
3.8
4.0
4.1
4.2
4.5
4.5
4.7
4.9
5.0
5.1
5.6
5.8
6.3
6.8
7.0
7.5
7.6
0 2 4 6 8
Japan
Fiji
ROC
Nepal
Hong Kong SAR, China
Korea, Rep.
Thailand
Malaysia
Pakistan
Philippines
Iran
Sri Lanka
Indonesia
Bangladesh
Singapore
Mongolia
Lao PDR
Vietnam
India
Cambodia
%
2001-2010
unit: %
47. GROWING IMPORTANCE OF APO20
• Rapid GDP increase is shown in regions where APO member
economies are located: from 1970 to 2008
- APO20 (5 times), East Asia (8 times), South Asia (6.5 times),
ASEAN (9 times),
- US (3 times), EU15 (2.5 times)
• In 1970: APO20 was 60% of the US and EU15
• In 2008: APO20 is higher than US and EU15
= Growing economic importance of the APO20
48. Cross-region Comparisons of GDP
1970 (%) 2008 (%)
APO20 2,538 191.1 APO20 13,360 332.3
East Asia 1,772 133.5 East Asia 13,858 344.7
South Asia 583 43.9 South Asia 3,832 95.3
ASEAN 276 20.8 ASEAN 2,572 64.0
(reference) (reference)
US 4,224 318.2 US 13,008 323.6
EU15 4,939 372.0 EU15 12,466 310.1
unit: %
unit: %
Unit: Billions of US dollars at constant market prices, using 2005 PPPs
In 2008: GDP of APO20 > GDP of US and EU15
Growing importance of APO20
49. PRODUCTIVITY GROWTH IN APO20
• In terms of the following productivity
indicators:
- Labor Productivity (LP)
- Total Factor Productivity (TFP)
51. 4 Tigers, Malaysia, Thailand are top 6
in Labor Productivity growth (1961-2010)
1961-2010 avg. labor productivity
-0.3
0.8
1.0
1.0
1.0
1.3
1.5
1.5
1.9
3.1
3.1
3.1
3.5
3.6
3.7
3.7
3.8
4.1
4.2
4.6
-2 0 2 4 6
I r an
Fiji
Ban g lad es h
Nep al
Cam b o d ia
Ph ilip p in es
Pak is tan
M o n g o lia
J ap an
I n d ia
I n d o n es ia
Sr i lan k a
L ao
Vietn am
T h ailan d
Ho n g k o n g
M alay s ia
Sin g ar p o r e
Ko r ea
ROC
%
Avg.
unit: %
52. Lao PDR, India, Cambodia, Vietnam, Sri Lanka,
Mongolia: Catching up in 2000s
2001-2010 labor productivity
-0.2
0.3
0.7
1.4
1.5
2.1
2.1
2.4
2.7
2.7
2.9
2.9
3.0
3.4
4.0
4.2
5.0
5.4
5.8
6.1
-2 0 2 4 6 8
Nep al
Fiji
J ap an
Pak is tan
ROC
M alay s ia
Ph ilip p in es
Ko r ea
Sin g ar p o r e
I r an
Ho n g k o n g
I n d o n es ia
Ban g lad es h
T h ailan d
M o n g o lia
Sr i lan k a
Vietn am
Cam b o d ia
I n d ia
L ao
%
2001-2010
unit: %
53. Labor Productivity Growth: 1971-2008
• Cross-region comparisons:
The LP growth rate of APO20 is 2.7% in 1971-2008,
which is about double than the US , or 60% more than
the EU15.
Labor Productivity level of APO20 is still much lower
than developed countries (US, EU15), about 15 % of
US and 20% of EU15 in 2008.
54. Economic Performance of APO20:
A Summary
The APO member economies have achieved remarkable
economic growth in the last 50 years and contributed in
making Asia-pacific as the most dynamic and fastest growing
region.
With its GDP being larger than that of the US and EU in 2008,
the growing importance and economic influence of APO
member economies has also been well recognized.
The labor productivity growth rate of APO20 is double that of
the US , or 60% more than the EU15 in the past 4 decades.
55. Economic Performance of APO20:
A Summary
The APO20 is catching up, despite its GDP per capita
and level of labor productivity is still much lower than
developed economies.
In 1960s-1980s, East Asia countries ( Japan and 4
Tigers) enjoyed high GDP and productivity growth,
whereas South Asia and ASEAN countries are growth
leaders in 1990s-2000s.
56. What were the drivers of Economic Growth and
Labor Productivity Growth in APO 20
Summary Results of the APO Study in
2011 (“Productivity in Retrospect”)
are highlighted in the following slides
57. Results: Drivers of GDP Growth 1971-2008
Based on the APO Research in 2011:
• The main driver of economic growth for all of
APO member countries is Capital
Accumulation, and mostly non-IT capital
accumulation, in the past decades.
58. Results: Drivers of Labor Productivity Growth
• Capital Deepening is the main driver of Labor
Productivity Growth with Non-IT Capital Deepening
accounting for most of the effect.
• Contribution shares of IT Capital increased over
time, with significant increase in 1990s and 2000s.
59. TFP Growth Rates in APO 20
• TFP growth rate vary by country and by period.
• TFP growth rates in developed economies (Japan
and 4 Tigers) are relatively higher than those in
developing economies of APO.
• TFP growth rates in 2000s are higher than those in
previous periods.
60. Drivers of TFP and Labor Productivity
Growth
• Driving forces of TFP and Labor Productivity growth of
APO member economies in the last 5 decades are:
1) Human capital investment (Edu_yr) has shown positive
and significant impact on TFP growth for Singapore,
Philippines, Thailand, Malaysia and Iran; and on LP
growth for Philippines, Thailand, Malaysia and Iran.
2) R&D investment has positive and significant impact on
TFP growth for ROC, Japan, Thailand and Malaysia; and
on LP growth for ROC, Japan, Malaysia.
61. 3) Openness trade policy induces positive impact on
TFP growth for ROC, Indonesia, Singapore, Korea,
India, Philippines, Thailand, and Malaysia; and on
LP growth for Cambodia, Indonesia, Pakistan,
Philippines, Malaysia and Iran.
4) Initial condition and country specific variables
have significant impact on TFP growth in Mongolia,
India and Malaysia; and on LP growth in Cambodia,
Korea, Philippines, Thailand and Malaysia.
Drivers of TFP and Labor Productivity
Growth
62. • Non-IT capital accumulation is the main driver of
economic growth for APO member countries in the past
50 years, which indicates a resource and investment
driven growth. This way of growth will not be
sustained.
• IT capital investment has increased over time since
1990s, which could lead toward a productivity and
innovation driven growth in the future.
Drivers of TFP and Labor Productivity
Growth
63. • Public and private investment on human capital and
R&D should be sufficiently financed to increase the
knowledge capacities of businesses and individuals for
fostering future innovation.
• Openness of trade policy or free trade agreement
framework, which facilitates technology transfer,
should be further expanded.
Implications of TFP and Labor Productivity
Growth
64. Issues and Challenges
• Despite the fact that each country faces
different resource, economic and social
constraints, the following four issues and
challenges are however commonly confronted
by most of APO member economies.
65. • R&D and human capital investments have been
commonly demanded by most of APO member economies
for improving their future productivity in the era of
knowledge economy.
• For those technology-led, developed economies:
How to boost knowledge and innovative capacities of
people and business to compensate the productivity loss
due to declining labor force in the future is an emerging
challenge .
• For other developing economies: Investment in quality of
human capital, education and training for worker’s skill
upgrading are recognized as important future direction of
productivity initiates.
1. R&D and investment in human capital development
Issues and Challenges
66. • Despite recognizing the importance of capital and
R&D investment in productivity improvement:
– most of developing economies suffer shortage
of capital expenditure and technology
disadvantage.
• Therefore, how to provide effective incentives and
trade and investment policies to attract more FDI
and technology inflow from advanced economies is
an important challenge.
2. How to Attract FDI and technology inflow
Issues and Challenges
67. • Asian developing economies are abundant in natural
resources and human resources, but often lack in capital
inputs and advanced technology. On the contrary, Asian
developed economies are rich in capital resources and
with advanced technology, but often fail to have sufficient
market demand.
• Economic cooperation in forms of free trade or joint
investment between these two types of countries would
create mutual benefits. It also improves price competitiveness
and induce technological diffusion.
• However, how to establish freer trade framework or
investment cooperation among economies is a complicated
issue and challenge.
3. Regional economic cooperation
Issues and Challenges
68. • A good and conducive operational environment is
crucial to foster productivity growth.
• How to develop such good environment, under
resource and regulatory constraints, is a difficult
task to policy makers.
4. Development of operational environment
Issues and Challenges
69. End of Module 2
Congratulations for finishing your lessons on
Module 2!
You are now ready to take the quiz to see
how far you have
absorbed the content of this module.
There are 10 items of the quiz.
70. End of Module 2
But wait…
You are encouraged to email to
industry@apo-tokyo.org
if you have questions and/or points for
clarification on any of the lessons
taken up in this Module.
If none, you may now close
Module 2 Course Manual and
proceed to the Module Quiz.
71. End of Module 2
What are my Top
3 Takeaways or my
Most Significant
Learnings from this
module?
After taking the quiz,
you are encouraged to
reflect and answer
the question on this slide.
Write your answer on your
productivity journal.
