Introduction: Financialisation and Development in Asia under Late Capitalism

Abstract

Multilateral development agencies have increasingly focused attention on underdeveloped countries in Asia as potential new sites for financial capital. Often referred to as “emerging markets”, these economies are seen as ripe for private sector investment and, at the same time, in need of foreign capital to support rapid industrialisation, modernisation and poverty reduction. For development agencies, this confluence of interests suggests a means for quickly closing the “development gap”, primarily through mobilising techno-managerial modalities designed to reduce barriers to capital entry and other institutional inefficiencies seen as inimical to investment. Thus development agencies now encourage the construction of “enabling environments” to support “market driven development” through processes of “financialisation”. Development, in this sense, is no longer state-led or state-centred, but rather financially driven and privately procured.

As we highlight in this special issue, however, financialised modes of development are highly contested and problematic. Indeed, the diffusion into the underdeveloped world of essentially developed world financialisation agendas that seek to instil a broad-based market rationalism that downloads new costs and risks to populations is of significant concern. This Introduction sets in context and introduces a much needed set of articles that bring clarity to financialisation in developing Asia and its implications for development as a process of substantively improving material conditions.

Keywords:

• development
• deep marketisation
• emerging markets
• financialisation
• late capitalism
• neoliberalism

Notes

1. The G7 refers to an industrialised country grouping that includes Canada, France, Germany, Italy, Japan, the United Kingdom and the United States.

2. See, for example, McKinsey Global Institute (2012, p. 1); see also The Wealth Report 2012 (Frank Knight & Citi Private Bank, http://www.thewealthreport.net/The-Wealth-Report-2012.pdf).

3. We would like to credit Tauel Harper for this phrase, which came out of discussions that one of us had with him regarding the global political economy.

4. Total outstanding commitments for the World Bank are calculated by combining outstanding loans and credits for the International Bank for Reconstruction and Development and the International Development Association for the given period.