ABSTRACT
Over the last couple of decades or so, a number of Asia-Pacific economies have witnessed unprecedented levels of economic growth (Japan and Korea experienced this much earlier) and the region has been a major contributor to global prosperity and stability. The economic crisis of the late 1990s suddenly halted this remarkable economic run. Importantly, it highlighted a number of characteristics of the affected economies which needed major changes so as to enable them to assimilate into the global economy (Arndt and Hall, 1999; Yip, 2000). Already a number of efforts have been made to achieve this (see Chen, 2002); however, several macro-level phenomena unique to each of the economies in the region (such as their political set-up, regulatory set-up, very high level of corruption, and family matters) are creating major hindrances in this regard (see The Economist, 2002; Lau, 2002; Tsui-Auch and Lee, 2003). Nevertheless, at present, the Asia-Pacific region produces more goods and services than either North America or the European Union and this trend is expected to accelerate in the years to come. Moreover, out of the twenty-five most important emerging markets, ten or more are regularly from the Asia-Pacific region (see The Economist, 2003). Further, they attract an enormous amount of foreign direct investment (FDI). Despite the fact that global FDI inflows declined in 2002 for the second consecutive year, FDI in Asia and the Pacific declined the least in comparison to other regions of the world, and China with a record inflow of $53 billion became the world’s biggest host country (for more details see UNCTAD, 2003). It is also predicted that most new members of the newly affluent nations will come from the Asia-Pacific in the twenty-first century (see Tan, 2002). Despite all this, most of the Asia-Pacific economies (excluding Japan, Australia and to some extent Korea) have a long way to go before they can be considered on a par with their western counterparts in both economic development and management professionalism. For example, many Asia-Pacific countries have reached a stage of development where their future source of growth will not lie primarily with the inflow of FDI, but with innovation, research and development and generating their own FDI. Moreover, many of the advanced Asia-Pacific countries (for example, Singapore, Korea and Taiwan) have lost their cheap
labor and property advantage to some of the emerging economies in the region (such as China, India and Thailand). A possible way forward for them is to shift their economic activities from mass production to development hubs (see Tan, 2002). Such developments have serious implications for the human resource management (HRM) function in the region, especially when human resources (HRs) are known to play a significant role in the economic development of nations (see Tayeb, 1995; Debrah et al., 2000).
