Social Foundations of East Asian Social Policy
Yasuhiro KAMIMURA
1. The Need for a Region-Wide Social Policy
Regional integration in East Asia has been led by market forces, not,by political leadership (Shoji 2007: 201). East Asia s intra-regional traderatio was less than 40% in the 1980s, and is now approaching 55%, whichis comparable to the level in the European Union (EU) at the time of thelaunching of the single market (METI 2005: 437). The ASEAN countries, aswell as Japan, China, Korea, and recently India, have concluded Free Trade
Agreements (FTAs) and Economic Partnership Agreements (EPAs), butthese agreements conﬁrm, rather than lead, market integration.
As a social policy specialist, I propose to develop an idea for region-widesocial policy that will counterbalance economic integration. The deepeningof a free trade market without a counterbalancing social policy is the roadto the satanic mill , of which Karl Polanyi warned 65 years ago (Polanyi
2001: 35). In the postwar era, the redistributive welfare state was the answer
to avoid this disaster. This simple solution, however, cannot be applied tothe region-wide social policy of our day because the welfare state type ofsocial policy needs an effective democracy and a taxation system, neitherof which exists, so far, within the regional context. We should learn fromthe experience of the EU, which suggests the possibility of a multi-level
regional governance of social policy. There occurs a restructuring of spatial
boundaries of welfare in the EU (Ferrera 2005).
There are at least two examples to learn from in the experience of the EU
social policy. Firstly, the Open Method of Coordination (OMC), set up by theLisbon Strategy of 2000, is useful for improving the social policies of eachmember country. Member countries agree to identify their most eﬀective− 87 −

social policies with the aim of learning from each others

experiences(European Commission 2008). Therefore, comparative study and mutual
learning are essential to the improvement process. For this purpose, it isimportant to share common indicators for measuring the progress of eachcountry towards common objectives. Eurostat may provide these kindsof indicators. This is a flexible and decentralized method without legal
constraints (ibid.), and can encourage each country̶without infringing on
national sovereignty̶to improve its social policies. It is not so unrealistic for
East Asian countries to learn from this.
Secondly, the European Social Fund (ESF), established by the Treaty ofRome of 1957, contributes to reducing the differences in prosperity andliving standards across member countries by subsidizing the jobs and skillrelated projects of local governments and NGOs (European Commission2007). Economically less advanced countries are given priority in receiving
the subsidy. Over the period 2007-2013, 77 billion euro will be distributed.
This represents around 10% of the total budget of the EU (ibid.). The
local governments and NGOs can apply for the subsidy, and the European
Commission can promote its own strategy directly through the subsidy.
Here is a possibility for resolving the problem of the democratic deﬁcit , as
it is called, in the EU. The future East Asian Community (EAC) should also
have this kind of mechanism to reduce disparities within the region.
The rest of this paper is a sketch of the social foundations of regionwide social policy in East Asia. I would like to answer the following threequestions. First, how should we do the comparative study of East Asian
countries to improve their social policies, as is done in the EU process ofOpen Method of Coordination? I propose to use the provinces of China as
units of comparison. Second, what are the characteristics or principles of social
policy that East Asian countries have now, and should have in the future?
I argue that productive welfare neither capture reality nor is enough as aprinciple. Third, how can we build a system of region-wide social policy inEast Asia? I recommend a reform of the Oﬃcial Development Assistance− 88 −

(ODA) into a more democratic foundation for region-wide social policy.
2. How Should We Compare East Asian Countries?
How should we do the comparative study of East Asian countries toimprove their social policies, as is done in the EU process of Open Methodof Coordination? As I argued above, comparison and mutual learning are
essential to the OMC process. However, East Asia has some diﬃculties inthis because the member countries are too divergent in size and economiclevel.
Figure 1 shows the population size and GDP per capita of each country(Black dots represent East Asian countries, and white dots represent EUmember countries). As you can see, China is a Jupiter-like planet. It is threetimes as large as the EU in population size, and too big to compare withother countries.
I propose to use the provinces of China as units of comparison. Figure 2is the same comparison, but with the provincial units of China (Provincesof China are represented by+.

Indonesia and Japan also seem large

enough to divide into three or four parts!). We can see that some provincesof China are as large as Germany in population size. We also realize that
economic divergence in East Asia is much larger than that in Europe. While
European countries belong to almost the same world, there seem to be three
economically diﬀerent worlds in East Asia. The ﬁrst is the advanced world(high-income economies), including Japan, Korea, Taiwan, and some urban
areas of China like Shanghai, Beijing, and Tianjin. The second is the semiadvanced world (middle-income economies), including Malaysia, Thailand,
and the coastal provinces of China like Jiangsu, Zhejiang, Guangdong and soon. The third is the developing world (low-income economies), including thePhilippines, Indonesia, Vietnam, Cambodia, Mongolia, Laos, Myanmar, andthe inland provinces of China like Anhui, Hunan, Sichuan and so on. Thus,
China cuts across all three worlds.
There is another aspect of divergence in East Asia, which is the phase− 89 −

of industrialization. As Figure 3 shows, while Japan, Korea, and Taiwan
are on their way to becoming service economies, most of the other EastAsian countries are still in the phase of industrialization. Some of thecoastal provinces of China seem to be at the peak of industrialization,
and are worthy of the name Workshop of the World. As a side effectof industrialization, population ageing has started in East Asian countries.
Figure 4 suggests that some of the inland provinces of China haveexperienced population ageing before the economic growth that can aﬀord it.
3. What are the Principles of East Asian Social Policy?
What are the characteristics or principles that social policy in East Asiancountries have now and should have in the future? Late Korean President
Kim Dae-jung was the primary advocate of productive welfare. It was
the guiding principle of his administration for reconciling democracy withthe market economy in the era of globalization. While his social policy laidemphasis on social investment, it also did not forget redistributive measures.
Gough (2004) also used the term productivist regimes for describing thecharacteristics of social policy in East Asian countries. Productivist means
the type of social policy which lays stress on health and education.
Figure 5, however, raises doubts about productivism as a characteristicof East Asian social policy. Most of the EU countries pay more for both
health and education in comparison to East Asian countries, although theexpenditure on health seems to be an effect of population ageing. Somecountries, such as Malaysia, Mongolia, and Korea, expend more on education.
Figure 6 indicates that Mongolia and Korea lay stress on basic education,
while Malaysia (and Hong Kong) pay also for higher education. Anyway,these are not the main characteristics of East Asia in comparison with theEU countries.
Though lower public health expenditure is mainly related to a younger
population, it is also connected to higher private health expenditure in somecountries. As Figure 7 shows, out-of-pocket payments partly substitute public− 90 −expenditure in such countries as Cambodia, Vietnam, Laos, and China. I am
afraid that health disparities may be exacerbated in such countries. They
can learn from the Mongolian model, in which the public-private mix seems
well balanced.
It may be partly true that welfare should be productive in the era ofglobalization. To be productive is not enough, however. Equality and security
should also be important principles for East Asian social policy. Lower Gini
index means higher equality. The number of physicians per population unit
may be interpreted as an indicator of security. Figure 8 shows that there
are two worlds in East Asia. The ﬁrst one enjoys a roughly similar statusof equality and security to the EU countries. The other world experiencesmore inequality and insecurity. Once again, the Mongolian case seems to beworth investigating.
4. A Vision of Multi-level Regional Social Policy in East Asia
How can we build a system of region-wide social policy in East Asia? Thecase of Aceh may provide a clue to it. On December 26th 2004, the SumatraAndaman earthquake killed nearly 230,000 people in the surrounding
countries, including 165,000 people in Aceh, Indonesia. This disaster broughta great experiment of post-disaster reconstruction, with an unprecedented
scale of international aid, to Aceh. 44 countries and many international
agencies and NGOs participated in the experiment, funding 3,430 million
dollars in total.
In Aceh, the sources of international aid were global, rather than regional,
and the largest aid was from the United States. As Figure 9 shows, North
East Asian countries like Japan, China, and Korea were not as willing to pay
for the reconstruction as the Western countries were. Of course, Australia
had geopolitical reasons for doing much, and the Netherlands was theformer colonial master of Indonesia. Countries like Canada, Germany, UK,and Ireland, however, did not have any special reasons, other than universal
altruism, for providing aid. Here, global universal aid surpasses regional− 91 −mutual aid. While we do not have any reason to deny global universalism,
we should consider upgrading region-wide mutual aid.
I suggest a reform of the Oﬃcial Development Assistance (ODA) of Japanand other East Asian countries into a more democratic foundation forregion-wide social policy. The present allocation system of Japan s ODA isbureaucratic rather than democratic, and lays stress on civil engineeringrather than on social protection. The geographic distribution of Japan s ODA
is uneven (Figure 10). Also, the amount of Japan s ODA is modest comparedto other developed countries (Figure 11).
In the coming decade, Japan, China, Korea, Taiwan, and other East Asian
countries may pool their aid budgets into the Asian Social Fund (ASF),
to dilute their national interests and to contribute to region-wide interest.
A region-wide democratic parliament may be established to discuss how
to allocate funds. The members of the parliament may be elected fromprovinces, not from countries. Of course, national social policy will continue
to perform important functions. In that manner, we can build a multi-level
regional governance of social policy in East Asia.

References
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the New Spatial Politics of Social Solidarity, Oxford University Press.
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Kamimura, Yasuhiro, 2006a, Welfare states in East Asia: Similar Conditions,− 92 −

Different Past and Divided Future,

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Figure 1. China is too big to compare with others.

Figure 2. Three worlds in East Asia and China.

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Figure 3. The diﬀerent phases of industrialization.

Figure 4. Population ageing in inland China before economic growth.

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Figure 5. Health and education: Are East Asian countries productivist?

Figure 6. Not all East Asian countries are productivist.

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Figure 7. Public and private mix of health services.

Figure 8. Two important values: equality and safety.

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Figure 9. There was no East Asian social policy in Aceh.

Figure 10. Uneven distribution of Japan s ODA in East Asia.

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Figure 11. The budget of Japan s ODA is comparatively modest.

Data Sources
Figure1: UNDP, 2008, Human Development Report 2007/2008 . As forTaiwan, DGBAS, 2007, Statistical Yearbook of the Republic ofChina 2007.
Figure2: ibid. As for China, National Bureau of Statistics of China, 2008,

China Statistical Yearbook 2008.
Figure3: ibid. As for the EU countries, OECD, StatExtracts (data of 2005).
Figure4: ibid.
Figure5: ibid.
Figure6: ibid.
Figure7: ibid.
Figure8: ibid.
Figure9: As for Aceh, BRR, Reconstruction Aceh-Nias (RAN) Database(http://rand.brr.go.id/RAND/).
Figure10: Ministry of Foreign Aﬀairs of Japan, 2008, White Paper on Oﬃcial− 99 −

Development Assistance 2008 (www.mofa.go.jp/policy/oda/white/2008/part4.pdf).
Figure11: Ministry of Foreign Aﬀairs of Japan, 2009, Oﬃcial Development

Assistance of DAC countries 2008(www.mofa.go.jp/mofaj/gaiko/oda/shiryo/jisseki/souron/2008̲dac.
html).

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