Have you noticed the way we look at emerging countries has changed in recent years? It seems like there's a race going on, with emerging countries catching up to the West, thanks to their rapidly growing populations. More people equals a bigger economic pie, right? But amidst all this growth, many are failing to see the differences between the technologically superior countries like Japan, South Korea, Taiwan, Singapore, and China, who are the real competitors against the so-called "developed" nations.
Remember the 90s, when everyone thought Japan was going to take over the world? Fast forward to today, and we've seen the rise of the BRIC nations (Brazil, Russia, India, and China) and the EU integration of the Eastern blocs. The thinking goes that these countries will use their cheap labor for manufacturing goods and the Western countries will move on to the intellectual, high-margin industries.
As we look to the future, this race for tech supremacy is only going to get more intense. Countries like India, the ASEAN nations, and Africa are predicted to experience population growth well into 2050, so their economic power is only going to grow.
Now, you might think that the West is still in the lead here. Sure, emerging technologies like AI, self-driving cars, renewable energy, quantum computing, and nuclear fusion are exciting, but the US remains the frontrunner in these fields. So, the global hierarchy of technology isn't changing...or is it?
Let's take a closer look at the Economic Complexity Index (ECI), which measures the complexity and rarity of items exported from a country. This index can shed some light on the technological powers we may have been underestimating.
In a nutshell, the ECI measures the complexity and rarity of items being exported from a country. For instance, Canada exporting pork to Japan would score low on the index since it's something any country could produce. On the other hand, the Japanese production of large mirror lenses used in space programs would score high, as very few countries can create such advanced tech – giving Japan a monopoly position in the market.
You might wonder why this is so important, and I've got some fascinating examples to show you just why this chart is such a game-changer.
Remember last year when Germany planned to ship tanks to aid Ukraine in their war efforts? Well, they had to halt that aid due to Switzerland's neutrality initiative because the tanks used Swiss-made bullets! Although politicians yelled about producing the ammunition elsewhere, they quickly realized it's not as easy as it seemed.
Another perfect example is Taiwan. While everyone is familiar with Google's search capabilities, not many people actually think about the hardware that drives it. American AI companies rely heavily on Taiwanese chips for their systems to run. And guess where the machines that make those AI chip-making machines come from? Japan!
It's vital to note that there's no correlation between ECI and GDP since the latter is easily influenced by factors like government borrowing, foreign relations, commodity booms, housing bubbles, and so on. However, we can safely say that the ECI is an excellent long-term prediction tool, especially as we approach the 4th industrial revolution.
The main takeaway here is that technology is much more intricate and complicated than just Elon Musk's flushy startups. It involves complex systems, with some parts being far more intricate than others. So, if you're trying to predict the future of the 21st century, the ECI suggests that Japan, Switzerland, Taiwan, South Korea, and Germany will be the frontrunners, leaving America's technological advantage overestimated due to marketing efforts and media influence.
Here's my simple prediction but the narrative of catchup of emerging countries to be overtaken by some new countreis in East Asia and a few from the today's developed countries will be obvious to everyone in 2040s. Until then, everyone'd be left confused as who's taking the lead in the next innovation curve.
Keep your eyes on the ECI, friends! The tech landscape precedes politcal power and national brands. Our worldview may look very different in the years to come, and we don't want to be caught off guard. So, let's dive deeper into the complexities and appreciate the intricate systems that will shape our tech-driven future.