Economic Miracle Lessons for Africa from Asian Tiger and Tiger Cub Economies

Theories on Linear Modernization and Economic Growth of Nations:Alexander Gerschenkron (1904-1974) Backwardness Model of stage wise linear economic growth hinged on his 1951 essay on, Economic Backwardness in Historical Perspective’. He listed economic backwardness indicators to include low per capita, low social overhead capital, low literacy, low savings rates and low level of technological progress. Gerschenkron Model says the more a country is economically backward, the higher the likelihood it will experience exponential industrial and GDP growth, rank production over consumption, launch large scale companies and manufacturing plants, prioritize technology adoption, choose capital intensive over labor intensive, rapidly reduce agriculture share of GDP, supply capital and entrepreneurship through large banks and government.

Walt Whitman Rostow (1916-2003) served US Presidents John F. Kennedy and Lyndon B. Johnson as a national security and foreign policy adviser. In 1960 he authored his book, ‘The Stages of Economic Growth: A Non-Communist Manifesto’. Each of the five linear stages have differing levels of investment, consumption and social trends. Traditional society stage economy is rural, subsistence, barter trade, low per capita income, and agricultural.

Preconditions for take-off stage emphasizes education and skilling, specialization, production of surplus for trade, banks rise to mobilize capital for a growing entrepreneurial class (Chinese Guanxi, Japanese Keiretsu/Zaibatsu, South Korean Chaebols), limited manufacturing production and infrastructure investments.

Take off stage depends on urbanization, industrial sector becomes larger than agriculture, growth of investment to more than 20 percent of GDP, regional growth and smart politics. Drive to maturity phase depends on developed economies, rising levels of living , diversification of sectors, innovation, import substitution, exports promotion, and investments.

High mass consumption depends on the global free market economies, high durable goods consumption and services surpasses industry GDP.

Economic Miracles of the Four East Asian Tiger Economies and The Five South East Asia Tiger Cub Economies  

Between 1960s and 1990s, Hong Kong, Singapore (Lee Kuan Yew from 3^rd World to 1^st World in one generation), South Korea (Miracle on the Han River) and Taiwan (Economic and Political Miracle) experienced rapid modernization and growth of their economies.

This is in concurrence with Rostow’s Stages of Economic Growth and Alexander Gerschenkron Backwardness Model.

They rapidly increased their education and training investments to create a highly skilled, productive and meritocracy driven workforce.

They raised their share of industrial manufacturing GDP over agriculture by prioritizing hinged on technology and innovation.

In addition, they invested in CAPEX infrastructure (roads, seaports, railways, energy, WASH) to drive economic and trade corridors.

Also Read: China Warns Countries Against Striking Deals With US

They adopted export promotion to advanced nations.

Also, they institutionalized favorable government policies like heavy support for exporters, access to low-interest rate credit for entrepreneurs, open economy, free trade, low taxes, minimalist welfare state, deregulation, effective civil service bureaucracy, democratic political miracle, strong governance and leadership.

The Five South East Asia Tiger Cub Economies (Indonesia, Malaysia, Philippines, Thailand, Vietnam) followed the highly successful export promotion economic model of the Four Asian Tigers to modernize and industrialize their economies.

GDP, Savings and Investment of Africa Versus Asian Tiger and Tiger Cubs

The International Monetary Fund (IMF) projects 2025 GDP for South Korea at $1,790bn and Indonesia at $1,429bn to be bigger than Africa’s GDP.

Taiwan follows at $804bn, Thailand $546bn, Vietnam $490bn and Malysia $444bn.

In contrast, South Africa stands at $410bn, Egypt $347bn, Algeria $268bn, Nigeria $188bn and Morocco $165bn.Singapore has a high standard of living with GDP Per Capita of $92,932, Hongkong $56, 030, South Korea $34,641and Malysia $13,144.

Mauritius leads Africa in per capita income with $12,332, oil driven Gabon $8,841, Equatorial Guinea $7,750, diamond rich Botswana $7,020 and Libya $6,800.

Taiwan’s national savings as percent GDP in 2025 is estimated at 45, South Korea 35, Vietnam 33, Indonesia 30 and Hong Kong 27.

Mineral rich African countries lead in national savings as percent of GDP with Angola at 38, Nigeria 36, Gabon 35.7, Tanzania 35 and Algeria 34.

South Korea’s total investment as percent of GDP stands at 31.5, Indonesia 31, Vietnam 30, Taiwan 26.4, and Philippines 22.6.

Natural gas, coal, iron and aluminum rich Mozambique leads Africa in total investment as a percent of GDP of 50.6, Benin 38.3, Algeria 38.1, Tanzania 38 and Botswana 37.3.

Export Promotion, Literacy, Urbanization, Electricity, Access to Credit and Innovation

World Bank in 2023 recorded Hong Kong’s exports of goods and services as percent of GDP at 177, Singapore 174, Vietnam 87, Malysia 68.5 and Thailand 56.4.

Djibouti on the Red Sea leads Africa in exports of goods and services as percent of GDP at 169, Seychelles 86, Libya 85, Maldives 74.3 and Gabon 63.7.

Malysia and Vietnam led Asian Tiger Cub economies in 2022 with adult literacy rate as percent of people aged 15 and above at 96 and Thailand followed at 90 while Africa was led by Cape Verde at 91, Eswatini 90 and Zimbabwe at 89.8.

Also Read: Trump Announces Historic US-UK Trade Deal

Hong Kong and Singapore are completely urbanized with urban population as percentage of population at 100, South Korea 81, Malysia 78.7 and Indonesia 58 while Africa’s urbanization is led by Gabon at 91, Libya 82, Djibouti 78.5, Algeria 75 and Equatorial Guinea 74.

Data on electricity generation in terra-watt hours from Ember in 2023 shows South Korea at 618 TWh mostly coal, nuclear and gas, Indonesia 351, Taiwan 282, Vietnam 276 and Thailand 190 while Africa was led by South Africa at 234 TWh, Egypt 220, Algeria 96, Nigeria 43 and Morocco 42.

Hong Kong ranks high in domestic credit to private sector by banks as percent of GDP in 2023 at 249, South Korea 176, Thailand 119, and Malysia 117 while Mauritius leads Africa with 67, Tunisia 62, Morocco 58, South Africa 57.6 and Cabo Verde 55.Singapore was ranked 4^th in the 2024 WIPO Global Innovation Index,  South Korea 6^th, Hong Kong 18^th , Malysia 33 and Thailand 41 while Africa was led by Mauritius at 55, Morocco 66, South Africa 69 , Tunisia 81 and Egypt 86.

Follow our WhatsApp Channel and X Account for real-time news updates.