Asia’s manufacturing powerhouses, Japan, South Korea, and China, are among the fastest-aging countries in the world, while developing nations in Southeast Asia are among the youngest in the region. As factories, jobs, and investment flow south to tap younger and cheaper labor, economic growth in the 10-member Association of Southeast Asian Nations (Asean) is poised to accelerate, propelling the area’s currencies and fueling consumer and property booms, Bank of America (BAC) says.
Another advantage for Southeast Asia is proximity to Japan and China, which have billions to invest overseas. Japan’s foreign direct investment into the Asean region more than doubled in 2011, to $19.6 billion, from the year before, surpassing the $14.2 billion it invested in China and Hong Kong, according to the Japan External Trade Organization. “Asean labor costs are becoming relatively cheaper because China’s wages are rising,” says Satoshi Osanai, a Daiwa Institute of Research economist in Tokyo. Migrant workers’ average pay rose 21 percent in China to 2,049 yuan ($ 322) a month in 2011, according to the country’s National Bureau of Statistics. The average wage in Japan is 26 times higher than in the Philippines, government and International Labor Organization data show. A Japanese laborer makes an average daily wage of $ 209.20; a Manila worker paid at the high end of the minimum wage makes about $ 11 a day.