To put this in historical perspective - no region of the world saw sustained growth exceeding 5% for any period before the middle of the last century, except for Australia and New Zealand in the 19th century. No one expects growth to be linear or to continue unbroken, in either Asia or the Middle East. There will be bumps along the journey, sometimes flash floods, and sometimes a cave-in. But the basic trajectory is upward. The growth story that we are seeing is not an aberration, or a flash in the pan before growth in Asia or the Middle East recedes to the very modest norms that were seen for much of economic history before World War II. Growth is being propelled by fundamentals. First, both our regions have an abundance of natural resources, and are benefiting from the natural interplay between industrialization and demand for natural resources. Asia’s industrialization alone is driving an unprecedented global demand for raw materials, energy and other commodities. China and India alone have contributed over 35% of the increase in global oil demand over the last 15 years. Yes, there are huge inefficiencies in energy use, and concerns over the environment, that have to be addressed before long. But the basic interplay between industrialization and natural resources will continue for many years to come. Further, both our regions are not just opening up to global markets, but developing domestic demand in our own economies. They are diversifying, and growth is becoming more balanced.
In time, several aspects of transition differed from one country to another: smaller countries, such as the Baltic states or Slovenia and Slovakia, opted for a fast track towards Eurozone entry, inter alia because of geopolitical and security reasons, while states with larger and more complex economies, such as Poland, Hungary, Czechia or Romania, focused their efforts more on internal development. For instance, in Poland there is talk of “Polish-ization” and “nationalisation” of development, the spotlight being on the requirement to increase the country’s power resources: “if you cannot stand on your own feet, no one will listen to you”. In Romania, we had a very difficult transition in the first post-communist decade, with half-hearted, gradual reform, yet after 2000 our economy has evolved more coherently, having two important anchors: the EU and NATO. Events that were hard to foresee in the early ’90s took place as well. For instance, who would have thought that Slovakia, the less developed part of Czechoslovakia, would join the euro area and Czechia would not? Under the circumstances, does euro adoption testify to a high development level?