countries are well developed economically and are members of the Organization for Economic Co-operation and Development (OECD). The East Asian countries have been expanding rapidly and are sometimes referred as the Newly Industrializing Countries (NICs). Their development strategy was adopted by countries of South East Asia, some of which also performed exceedingly well. More recently, the South Asian nations have begun to open up their economies and look to Japan, East Asia as well as North America and Western Europe for sources of capital for economic expansion. The same applies to the economies in transition, which, until recently, were characterized by state control of industry and collectivized agriculture. They have also encouraged foreign investments with varying degrees of success. The Central Asian Republics, however, have to date established only minimal links with countries outside their region. The Pacific island countries, with limited market size and a small output-mix, have been facing budgetary problems and lack of industries to generate export revenues. The problems of some of the region's other developing countries have also been aggravated by geographical handicaps leading to costly transportation links with the rest of the world.
Over the last three decades, the Asia-Pacific economies as a whole had performed exceedingly well and had been the dynamic center of world economic expansion. The rise of the Asia-Pacific region can be traced back to the early 1960s when Japan spurred ahead to achieve industrial power status. Since then, the region experienced several fundamental and far-reaching economic changes and a new era of economic expansion set in. It outpaced the United States, the European Community and other countries in terms of economic growth. Japan's domestic output grew by over 10 per cent a year and it successfully overcame the exogenous economic disturbances of the 1970s. Japan was followed by the "four tigers" whose pace of economic growth surpassed that of Japan. Other Southeast Asian countries followed close on the heels of the tigers. China also experienced fast economic expansion after it opened up its economy two decades ago.
Often, questions are raised as to whether rapid economic growth is sustainable. In an age of globalization of production processes, where competition is
