Why The Future Is Asian- Parag Khana

Thank you for checking out The Front Row Podcast and my interview with Parag Khanna.

Parag Khanna is Founder & CEO of AlphaGeo, the leading AI-powered geospatial analytics platform. He is the internationally bestselling author of seven books including MOVE: Where People Are Going for a Better Future (2021), preceded by The Future is Asian: Commerce, Conflict & Culture in the 21st Century (2019)- both of which are books I highly recommend.

TIMESTAMPS:
00:00 Intro & Trailer
01:30 Why The China-US Frame Of The World Is Wrong
05:37 Eurocentric Historical Distortion
07:48 Asian History Rewritten
09:58 Our Present Is Already Asian
15:27 Reconstructing Asian Silk Roads
18:59 Why Technocracy Is The Most Important Element of Governance
24:21 Singapore and Switzerland As Parallels
30:08 What Makes Technocracy
30:53 Southeast Asia's Developmental Trajectory
34:45 China's Development Role
37:14 Why The Best Geopolitical Strategy Is Multi-Alignment
39:27 Why Globalisation and Migration Will Accelerate
48:58 Managing Migration And Its Downsides
55:50 Demographic Blending As The Future
01:00:38 Advice For Fresh Graduates Entering The Working World

This is the 63rd episode Of The Front Row Podcast

Keith 00:00:58

Today I'm joined by Dr. Parag Khanna. He's a leading global strategy adviser and a bestselling author of multiple books. One of the books that I highly recommend you read this year is Move, where he talks about how mass migration will affect the future of the world we live in.

He's also written another book called The Future Is Asian. In this book, he details how the economic and geopolitical weight of the world will gradually shift towards Asia. In fact, he argues that it won't happen in the future—it's already happening. I hope you enjoy my conversation with Dr. Khanna today.

You've said the most consequential misunderstanding permeating Western thought about Asia is that it's overly China-centric. Much of the geopolitical forecasting from the West primarily falls into this simplistic G2 conception of the United States and China competing to lead the world. My question to you is, why do you think that's a wrong framing for understanding the US and China?

Parag  00:02:03

It's wrong both from the top-down and from the bottom-up perspectives. It's wrong from the top down because it presumes that world history is nothing but a sequence of unipolar hegemonic orders in which you had Britain's Pax Britannica followed by America's Pax Americana. And during Pax Americana, you had a Cold War in which the world was divided into two camps—again, not actually true. Now you must have a number one, and that number one will either be America or China. And you have a new Cold War which will determine who is the new number one. That is an incredibly oversimplified way of understanding history from the top-down point of view.

It's also wrong from the bottom-up point of view because it doesn't understand Asia. It treats the world as if it's simply a flat board of risk. It thinks that for every system in the global system, there can only be one dominant player. But Asia is a world unto itself within that world. And even Asia is multipolar. Yes, China is more powerful than, say, Japan or India, but it doesn't mean that Japan and India don't exist.

Asia is a multipolar region in a multipolar world. That is the correct way to understand the landscape of power in 2025.

Within that, the United States and China are rivals. But they're not rivals to dominate the planet. The planet has 200 countries. Some are more important than others. The United States, China, the European Union, Russia, India, Japan, and Australia all think with their own brains. They all act in their own interests, as do other lesser powers, secondary powers like Saudi Arabia or Brazil.

It's a multipolar world. And yes, even if there is a winner between the US and China, if they were to have a direct hot war with each other, it still doesn't mean that the winner of that war dominates the world. Because the world—and this is the third point—doesn't really want to be dominated by any one power.

Most of the human species, which is Asian people in Asia, have come out of centuries of colonialism and the Cold War. The last thing that any Asian wants is to repeat colonialism or the Cold War. Therefore, they will make choices that ensure that even though China is very powerful, even though America is very powerful, you will not simply have a new hegemonic system where everyone must obey American dictates or Chinese dictates.

In a way, the reality of the world today as well as the future we're heading into is vastly more complicated—complex in a good way—than merely US-China new Cold War.

Keith 00:05:01

Why did this conception become so mainstream?

Parag  00:05:06

Models or heuristics that are neat and simple are going to be more snackable, more digestible, more understandable to ordinary people. And as the famous saying goes, they can be neat, simple, and wrong. Wrong is the key factor here.

Appreciating the world as it is in all of its complexity takes a lot more work. I wouldn't say that the neat, simple, wrong view you're characterizing is necessarily mainstream or the dominant perspective or the conventional wisdom. It might be the Twitter version of reality, but the gap between Twitter and reality is also quite vast.

If you ask most of the people most of the time in most places in the world how they see the world, I don't think the answer you would get is it is undeniably a new Cold War and the winner will dominate the world. Again, that's what happens when we have a warped perception of reality that comes from the oversimplified social media frame or from a dominant narrative coming out of Anglophone media, particularly United States media.

Whatever the origin is, I'm not interested in the point of departure being wrong. I'm interested in it being empirically correct. That's probably the difference between my work and Twitter. I base my analysis on the facts of the world, not simply on taking as a given something that was on the cover of the Economist magazine. That's not truth.

Keith 00:06:43

You made the point that a Eurocentric perspective of history might distort your interpretation of facts or might help you or force you to see things in a warped sense. And within Asia, it might be useful to have an Asian sense or Asian perspective of history. What is that?

Parag  00:07:01

The hardest chapter of the book The Future Is Asian to write was the first chapter, and it was called "A History of the World from the Asian Point of View." I wound up writing 250 pages, which is still only a fraction of what would be needed to rewrite Asian history. But the explicit intent was to take each time period of history going back literally to the Neolithic era—call it roughly the last 5,000 to 7,000 years—and to take what was happening in East Asia, South Asia, Central Asia, and West Asia for each time period going back pre-BC through the ancient civilizations, through the various time periods up through colonialism and into the present.

For every one of those periods of time, I looked at what was happening in each region and subregion of Asia and reconstructed literally Asian history from the Asian point of view. I needed to come up with terminology and vocabulary that would be palatable. Of course, you have disputes among them—who was the aggressor, the names of wars—but also critically to look at the flows between those civilizations.

What I did was identify many patterns and linkages amongst Asians themselves. What I found, of course, and you know this very well, is that if you're in India, if you're in China, if you're in Japan, if you're in Indonesia, you're going to get a localized national version of history. Everyone is the center of their own world.

What I wanted to do was create, in a way, a textbook embedded in a book that said if students in Asia could read just 50 pages—we had to cut it to 50 pages, it was very painful—a 50-page history of Asia that would be neutral and acceptable to Indonesians and Kazakhs and Saudi Arabians and Japanese and Mongolians. What would it look like? And that's what we wrote. That's what is in chapter one of the book.

It pains me that as someone who was of course born in Asia but grew up in the West and has come back to Asia, why did I, effectively as an American import, have to write for Asians this common Asian story in history? And why don't they know so much of it?

I'm very pleased that, obviously, that particular chapter has been translated in a lot of languages. It's been used in a lot of schools. And I want Asians to grow up realizing that they have their own history that's obviously pre-colonial and of course is informed and has experienced colonialism, but that isn't the beginning, middle, and end of the Asian story.

Keith 00:09:51

How would understanding that story, those 50 pages, change one's perspective of where the world is headed?

Parag  00:09:58

Well, for one thing, even if you didn't know that history, there are just the brute facts of Asia today in the world. And this is where it's an important contrast to the Eurocentric worldview. If your worldview is shaped by or determined by whenever you are given permission to believe that Asia is the center of the world, that will never happen. Because in Eurocentric or American-centric conversations, what's happened—what I've witnessed for 25 years as a professional in this field—is that for 25 years, Americans or Europeans have said yes, Asia is rising. Asia will one day be a competitor. Asia is becoming more important. Asia may shape the rules.

At no point does it ever actually happen in their point of view. Because then the entire edifice, the entire intellectual construct of Eurocentrism or US centrism would collapse, and they'll never permit it to happen in their minds.

What I did with this book was to basically say, what are you talking about? The world already is Asian. The dispute I had with my editors—who I give credit for coming up with the title The Future Is Asian because it sells—but I said there's a problem with this title, guys. The present is Asian. Even by saying the future is Asian, it's still this distant shimmering mirage on the horizon. But it's today.

The fact is, most of humanity is Asian. Most of the world's GDP is Asian. Most of the world's infrastructure investment is happening in Asia. Most trade is in Asia. Most savings is in Asia. It's you over there who are not in Asia that are on the periphery of the world. Asia is the center of the world. And that's not just a rhetorical device. It's a factual statement. And you need a mind shift to accept that reality.

What again I find really paradoxical and odd is that because many Asians, especially postcolonial societies, get their view of the world recycled and refracted through Western media, you're waiting for them to tell you that you're the center of the world when you already are the center of the world.

I take that inside-out, bottom-up view and say if you want to matter, you have to matter in Asia. Asia doesn't have to matter in Colombia to be the center of the world. For America to be relevant globally, it has to matter in Asia. Otherwise, it only matters in North America or in the transatlantic world.

Again, I have to emphasize, this is not just a clever rhetorical device because I write in English. These are facts, and it's the logical conclusion of these facts that I'm articulating. I don't need to have a dog in the fight. I can live anywhere in the world I want. I have lived everywhere in the world. I'm saying this because it's true. I'm not making an argument against the West. I'm a product of the West in so many ways. It's really about getting people to wake up, but not in a combative way at all. Just stating the fact that Asia is the present and also the future.

Keith 00:13:18

Can you give me some hard facts you think that most people in the West or even people in Asia are not aware of? What are some of the facts that they should look at and say, "Hey, the center of gravity in the world is now shifting towards Asia"?

Parag  00:13:29

Share of world GDP, share of the world population, share of world trade, share of global savings and capital formation—it's all here in Asia. There's no dispute. That's the beginning, middle, and end of the argument right there.

But beyond that, it's important for people to see the trajectory—the extent to which Asia is still Asianizing very rapidly. Asian states did sort of wait, let's say, until the end of the Cold War to rebuild those Silk Roads of connectivity amongst themselves. What you've seen in the past 35 years is a rapid acceleration of that embrace of the pre-colonial Asia.

The fact that despite the incredibly dizzying diversity across Asia, they've managed to reconstitute these Silk Roads and that Asians trade more with each other than with the rest of the world—that's only taken three decades—is mesmerizing. It's absolutely staggering and astounding and miraculous, and it's nowhere near complete. Which is an incredible thing.

I want people to have that common baseline understanding of where we were prior to these past couple of decades, what we've achieved in these past couple of decades, and the potential and room for continued growth in the next couple of decades in the Asian story.

Asia can literally be self-sufficient. If economics is about the optimization of land, labor, and capital—these factor inputs of production—think about how Asia has all the people, all the land, all the natural resources, all the industrial capability, all the capital, all the technology, all the know-how, all the ideas right here within Asia. Between the Mediterranean Sea and Japan and Russia and Australia is everything Asians need to survive just fine without the rest of the world.

Two quick points. I say in the book, Asia used to produce for the rest of the world. Now, the rest produces for Asia. Look at your Mag Seven. Look at your S&P, your Fortune 500 companies. Where does most of their revenue come from? From outside of their home markets and primarily from Asia. Who depends on whom here? Let's be absolutely clear.

The second is more intellectual, ideational about governance. Whenever I'm giving a lecture, let's say to a European or American audience, I need you to remember something very clearly. Take the city of Istanbul. Look at everyone east of Istanbul, which is most of the human population. Sixty percent of the human species lives east of the city of Istanbul. Now remember the following sentence: not one of those people cares what you think.

This is extremely important. Do you wake up in the morning wondering whether or not Donald Trump thinks Singapore is a well-governed country? Do we care at all?

Every Asian I've ever met, since the day I was born, to my more than a decade living here in Asia and traveling to practically every country on earth—have I ever met anyone in Asia who cares what anyone else outside of Asia thinks about their systems, about their models, about their trajectory?

It used to be when I was younger, when we were deferential to Western points of view. We all know our governments are better. We all know that they're better functioning. We all know that we have law and order and stability and national objectives around shared goals around modernization and so forth.

No one wakes up in the morning in Asia saying, "Ooh, I wish I had Washington-style of government." Do I need to tell you that? Of course I don't need to tell you that.

It's really important that we shift the narrative. Everyone in Asia can, does, and should wake up in the morning saying, "How can my society be a better version of itself? How can we be what we want to be in a better version of that?" Not how can we please some other audience.

Again, this is not a postcolonial revolutionary moment. I'm not trying to channel Nehru or Gandhi or Sun Yat-sen and other greats. We don't have to do that anymore. We don't even need that. We rest on the shoulders of giants. I'm trying to make obvious what is already a fact so that we never waste our time getting distracted on being better versions of ourselves here in Asia. And only we know how to do that. No outsider can tell us that.

Keith 00:18:02

If you look at the developmental history of Asia, say in the past 40, 50 years, a lot of this was actually also driven by the West—be it technological transfer, capital infusion. Singapore is a good example of that. My question to you is, if you look at the future being Asian or even the present being Asian, does that actually necessarily imply a recession of the West?

Parag  00:18:24

It fits into the first point about multipolarity. The West does not have to absolutely decline for Asia to rise. In a multipolar system strictly defined, you have either a balance of power or an equilibrium, but you have perhaps relatively coequal centers of gravity. Again, that's what we have today.

The United States hovering at 20-ish percent of the world economy. North America as a whole a little bit more, I think, geographically and regionally, not just nationally. Then you have the European Union or the broader European zone, which includes Britain despite Brexit—again, 20-ish percent of the global system. Then you have China, which is about 20 percent. Then you have the rest of Asia, another 10 to 15 percent. And that's most of the world economy. Latin America and Africa don't really add up to that much. They're geographically large and important, but they're not shaping the global system.

We already have a factually, materially distributed multipolar world. So clearly, yes, Asia's relative rise, Asia's absolute rise has caused statistically the relative decline on paper of the West. The West doesn't have to disappear.

I'm a very strong believer that there is an emergent North American union, despite Trump's economic attacks on Canada and Mexico and so forth. I believe Greenland, by the way, is going to become an independent country that will be a fourth member of a North American Union. Mexico, United States, Canada, Greenland—this is a bounteous continent which also has all of the land, labor, capital, technology, industry to be completely self-sufficient, a zone of peace, stability, prosperity, and innovation.

I'm actually very bullish on North America as a whole. And I think America is going to sort itself out too. And I'm very long on Europe. I lived as a teenager in Germany, and I have a lot of sympathy and understanding of how Europe evolves as a supranational and an intergovernmental set of bodies. I think that Europe, with its back against the wall now—both because of its economic malaise and unmanageable migration, to the risks from being outcompeted by America and China—is also waking up and is going to undertake certain reforms.

You have not only the potential for—in an academic hypothetical sense—you have the reality of these very, call them stable, fundamentally stable zones: North America, Europe, and Asia that dominate the world. So the West does not have to decline at all.

A lot of my work going back to my very first book is inspired by the historian Arnold Toynbee, the great British historian who lived in the 20th century. He wrote about how civilizations, ideally even when they're in relative decline, should actually not only channel the strengths that made them great but also absorb lessons from their own competitors to revitalize themselves. And he called that process challenge and response.

What I see right now, actually—and this was a very crucial message in the Asia book—I said in fact, Asia is not becoming like the West. The West is becoming like Asia. And you can see it in industrial policy and state capitalism. You can see it in wanting to embrace technocratic, strong executive leadership. You can see it in social conservatism—in the notion that they want to maintain societal stability and law and order. These are Asian ideas. These are actually what I call the pillars of the new Asian values: technocratic governance, mixed capitalism, social conservatism or incremental liberalization.

All across the West, you see countries starting to follow that playbook, which is totally the Asian playbook. It's not just coincidental. I've named these exact three things as the observable pillars of the new Asian values. We stick to them. We're doing them. Singapore embodies them very nicely. Others are copying that.

Are we converging towards them, or are they trying to become like us? I would say again, our systems are already manifestly superior. We have the momentum. We can always get better. Even Singapore can improve in various ways. China can too. India for sure can. Indonesia, everyone can get better. But a better version of itself, not copying from others.

But learning lessons from others is, quite frankly, a huge part of my work in technocracy. The idea that expertise governs and drives key decision-making is not premised on the idea that there's an elite class of rulers who simply follow their own whims. It's actually about cross-national learning. Looking at the studies that have been done elsewhere around what are the most efficient ways to deliver welfare, to deliver inclusive finance—all of these things, lessons can be learned.

I particularly focus on small countries. What has Singapore learned from Switzerland, from Israel, from Estonia, from New Zealand? We're all part of this global conversation of learning. And the race is not actually at all between East and West, North and South, Europe and America and Asia. It's actually individual countries and who is learning the fastest from the global repository of knowledge to improve itself. That's the race. That's the only race that matters.

Don't start from the top down ever. I love to do Olympian big-picture—the covers of my books all have big globes—but at the end of the day, act bottom-up. Act with your own two hands and feet and mind and improve your local circumstances. And that is the accumulated way in which you'll see macro change.

Keith 00:24:12

How do you see the tension between technocracy and democracy creatively playing with each other? Because if you look at a technocratic model of governance, for example in China, it seems that, even to someone from the inside or outside, it's not going to be necessarily democratic, just by the way you select leaders.

Parag  00:24:32

I do not view these as antithetical. Authoritarianism and democracy may be antithetical. Technocracy is not a euphemism for authoritarianism. Technocracy is superior to authoritarianism and superior to democracy, but it complements democracy.

One key tenet of technocracy is feedback loops. Who are you doing this for? Again, it's not about an elite class of leaders who are tin-eared and don't pay attention to the needs of the people. It's about those that most rapidly understand the needs of the people through feedback mechanisms and incorporate that into policymaking. That's good technocracy.

Singapore is good technocracy not because we have an election every five-ish years. Singapore is a good technocracy because 365 days a year we're listening to what people need and want and adapting our policies every single day. That's good technocracy. Good technocracy is more democratic than any democracy that has an election every five years. That's an 18th-century way of governing your country. I have no patience for that in the complex 21st century.

I'm for technocracy being better than democracy by being hyper-democratic.

And that's one of the classic misunderstandings about Singapore. Well, one party controls, one party wins most of the votes, one party dominates parliament. It's about the actions of governance, which include the feedback and the needs and the desires and the welfare and the ambitions of the people in policy. It doesn't get more democratic than that.

As far as I'm concerned, and I have to explain this quite frankly all across the world, even in Asia and certainly in the West, but in a way the question itself is wrong. And this is what the West is learning the hard way. It's the notion that democracy was better to begin with.

It's not. Good governance trumps any other consideration. Governance is more important than democracy, and governance hinges on accountability. And democracy is one way of achieving your selection of leaders and accountability. But the highest principle up here is good governance. Good governance rests on true accountability. All of these principles, both in the abstract and in reality, are more important than democracy.

Let's not even have a conversation where we, two Singaporeans, are saying, "But are we democratic enough?" That's not the question. That is one ingredient, and a very important one. I took classes on Tocqueville and wrote a book reflecting on Tocqueville. However, it is literally one thing. Our ideal state, our version of Plato's Republic, is about governance.

And the G-word, governance, is the one that, believe it or not, you don't hear much of in the West. Do you really want to have a conversation that's premised on the idea that we need to always strive for more democracy for the sake of it? For what? To what end? If the end is not better governance, that's not a conversation I even want to be part of.

Here in Singapore and in Asia, we're talking about governance. Governance, the effectiveness of governance. That's priority number one through ten. How you go about that—many different ways. And let's celebrate what China has done. Let's celebrate what India is trying to do. Let's celebrate what Singapore is. Let's not pretend there's one way to get to good governance.

Because I'm a political scientist. In my field, this has been written about at this point ad nauseam in the last 20 years—this distinction between governance and democracy. And it's—I will continue to proselytize this to the uninitiated because that's my job as an academic, as an educator. But let's not pretend that there's a debate about this anymore. It's just about educating people. We're not debating what the highest ideal is here.

Keith 00:28:24

You made the point about feedback loops, which was interesting because I remember President Tharman, before he became the president, he was a senior minister, and I think Fareed Zakaria asked him, and he was saying that he spends every weekend at the meet-the-people sessions practicing what he calls retail politics. And you do that as a senior minister, going down to the blocks of the HDBs to listen to people, to hear their problems.

Parag  00:28:48

My first visit to Singapore was more than 20 years ago, and one of my friends who is a PAP MP took me to a meet-the-people session down in the deck of HDB, and I was fascinated by that local retail politics, as President Tharman called it. And for those who haven't seen, it's always worth going back to watch his interview with Stephen Sackur on the BBC from an event in Switzerland, where he really schooled him on the kind of misperceptions about how Singapore is governed. And he's brilliant in that.

And again, this is just one example, and it's not the only example of how democracy actually functions in reality beyond the procedural norms of having competitive multi-party elections. That is one way in which you can express your system of democracy. It's not the only one. It's not necessarily the best one unless it's coupled with good governance.

Which is why in my book on technocracy, I singled out Singapore as the archetype of a good technocracy. But I actually gave equal space to Switzerland and Singapore. And Switzerland is in many ways considered the opposite of Singapore. But I said, "No, these countries have a huge amount in common because Switzerland is way more technocratic than people think."

The same country where the villagers tie their cow up at the gate and have a plebiscite over every little local issue is the same place where you have a hyper-competent, professionally trained, well-staffed and resourced civil service. The trains run on time in Switzerland not because it's democracy, but because it's a technocracy.

So Switzerland is way more technocratic than people think, and Singapore is way more democratic than people think. And it's just another example of how it's the fusion of these ideas and models and learnings that is going to lead to the best possible system in the end.

Keith 00:30:48

What other aspects of technocracies should people take note of in order to achieve good governance? So one example is, like you said, professionally trained civil service, you have strong feedback loops where policymakers are able to understand on-the-ground sentiment. What other aspects are needed for great governance?

Parag  00:31:05

Of course, meritocracy, a long-term outlook, institutions that are independent from constant political meddling and interference. These sorts of pillars, if you will, of technocracy are really crucial.

Within Southeast Asia, there's still a gap. We're not achieving the full potential that we could be. And that's something that has been articulated to me by someone like Gita Wirjawan from Indonesia. And he was saying that if you look at just the region, Southeast Asia, we have about 750 million people. We're only producing, say, 750,000 STEM graduates a year compared to, say, China or India, which produce twice or three times the number of STEM graduates.

Well, look, Southeast Asia is predominantly a postcolonial region that has seven, eight decades of independence, of emergence into modern state formation and modernization. It takes time. We're still a very poor region.

If Southeast Asia were a country—well, first of all, as a region, it's certainly the most successful postcolonial region. And Singapore is by far the most successful postcolonial country in the world. And that's a statement, because most countries on earth are postcolonial countries. The United Nations had 51 members in 1945. It has 200 today. So three-quarters of the countries on earth are postcolonial countries. Singapore is far and above the rest in terms of stability and achievement. That's itself monumental.

But Singapore cannot lift up all of ASEAN. So if ASEAN were a country of 700 million people, it would still be the most economically unequal country on the planet Earth. It's far more unequal than Africa, because Africa doesn't have nearly the wealth that Asia has.

We have Singapore and Brunei here with nearly six-figure per capita GDP, and we have East Timor and Myanmar with barely $2,000 per capita income—an income gap of 40 to 1. But are we toppling our regimes over this inequality? No. And by the way, there are youth protests across the region. We should talk about that. But it's about corruption. It's about opportunity. It's not about saying rich people aren't allowed to be rich.

Statistically, we have very high inequality here, but there's a recognition that we've come a long way and that it's more important to raise the floor than lower the ceiling. There's a lot of work still to be done to raise the floor. And that's in places like Indonesia. Look at its enormous population and its distribution, and of course Myanmar and Laos and Cambodia.

Again, it's a natural part of the economic evolution of a developing region, a postcolonial region, a poor, agrarian former colonial region—it's going to take time to develop. But it is embracing the opportunities. It is raising the floor. Huge investments in infrastructure, in social spending, in education, in connectivity, in fintech—all of these things are happening in a good way. So there's broad-based growth happening.

You can't expect the people of Sumatra to live like the people of Singapore overnight.

Keith 00:34:17

Part of that acceleration or push for greater development, a lot of it has to do with China. And I think we're starting to see that. A lot of technology being deployed across Southeast Asia or even across Asia is Chinese. We're starting to see a lot more infrastructure being built out by China. So my question is, if you look at the future is Asian, how much weight does China play?

Parag  00:34:48

China is one-third of Asia's population. It's less than half of its GDP. It receives less than a third of the foreign investment that comes into Asia. So it's technically, on paper, not as herculean a role as what you see on the ground.

So there's this—I don't want to say a mismatch. I think China's staggeringly important. And I think that China's rise is lifting Asia generally. And Belt and Road, RCEP, and a wide variety of other diplomatic economic instruments and agreements are helping to enable that.

Of course, I'm an infrastructure maximalist. I want to see more roads, more railways, more connectivity, more supply chains. And that's happening within ASEAN as ASEAN countries try to compete with China, and it's happening with China through RCEP and Belt and Road.

This year, 2025, the trade volume between China and ASEAN is forecasted to reach about $980 billion. Call it $1 trillion. That's an adjacent pair of regions which is the highest density of trade between any two zones in the world, and it's set to grow further and further.

RCEP, to remind everyone, was only ratified three years ago. So economists chronically underestimate the net value add of trade agreements, especially when they're not global. But in fact, it's in identifying and exploiting these complementarities that you achieve genuinely catalytic growth.

I think the debate that many people are having is really between low-cost, high-quality Chinese goods and who's making them, who's deploying them, and sovereignty-related issues—data privacy and dual-use technology and debt structures and so forth. And that's going to be negotiated case by case. We already see different patterns. How Malaysia relates to China is different from how Indonesia, the Philippines, or Vietnam relate to China. So we're a very heterogeneous region.

But I'm generally okay—the term that my first book was about, this term multi-alignment, about 20-something years ago—I was talking about how countries, as they modernize and try to forge their own role in the global diplomatic landscape, should ideally not go all-in with one partner only. Do everything Chinese or everything American or everything European, but rather mix and match and pick the best toolkit or partnerships for defense or investment or trade or tech, depending on what problem they're trying to solve. And that way, they avoid being recolonized, if you will.

And again, that's already top of mind. I don't have to tell Singaporeans this. I don't have to tell the people of Thailand or Malaysia or India this. They know from their own history that they don't want to repeat that history, as I was saying before. So multi-alignment is the norm.

Again, we can't change our geography. But on balance, there's no question that China's rise has been catalytic.

Keith 00:37:52

Ambassador Chan made a similar point when she came on the podcast. She was talking about how, from Singapore's point of view, it's always about choosing your own interest. So you can have a defense agreement with the US and you can be the biggest source of US FDI within the region, but at the same time you can be the biggest source of FDI for China.

Parag  00:38:15

There you go. It's totally possible, and that's multi-alignment. And whenever I get asked, "But eventually you have to choose sides," like, no, you do not eventually have to choose sides. You do not. Because that means you've sacrificed your sovereignty.

For everyone who says, "Oh, but tensions are really rising right now between the US and China," it's like, no. What we'll come down to is that you may choose sides at the micro level. You look at Indonesia. Well, you invite Japan in to build one high-speed rail, and then China comes in with a better bid, but then you decide that you're going to do a different trade agreement or take other foreign investment from Japan versus China.

So we'll always be arbitrating in terms of the small-i kinds of issues, but ideally never having to choose in the grand scheme of things. At the end of the day, you choose yourself. And I think that that's what sovereignty is about. And we still do live in a world of sovereignty.

Keith 00:39:17

There is this argument that we've reached peak globalization and everything from here on out is maybe—I won't say balkanization, but call it the end of globalization. What's your counterargument?

Parag  00:39:30

Well, I don't make a counterargument to it. It's just wrong. I mean, I've devoted my entire career to studying globalization. And so this is just another one of those areas where there's facts and then there's whatever people want to say. And whatever people want to say, they've been saying over and over.

I go back to—let's mark a point in time—the 9/11 terrorist attacks of 25 years ago. I was around then, and people said it's the end of globalization. And then came the global financial crisis seven years later. End of globalization. Then in 2016, you had Trump's first election and Brexit same year. End of globalization. Then you had COVID four years later. End of globalization. Now you have a US-China rivalry and nearshoring activity. Guess what people are saying? Let me hear it. The end of globalization.

Were they right after 9/11? No. Were they right after the financial crisis? No. Were they right after Brexit? No. Were they right after COVID? No. So you're starting to see a pattern here.

Here's my advice to people who believe it's the end of globalization. Please don't lose any sleep over globalization. Globalization will be just fine without you. You need to figure out what your role is in this rich globalized world that we live in.

And your perception of whether or not globalization is strong or weak probably has a lot to do with your own position. And if you're feeling left out, you may be denouncing it. But chances are globalization is thriving elsewhere and you're just not part of it. That's what the facts tell us.

Global trade, global finance, global investment, global connectivity, global digital flows, global migration are at absolute record levels or have been very resilient, if not at record levels. And for any area where it may be slightly weaker than it was, say, five years ago or 10 years ago, there's probably a very good reason.

I'll give you an example. One of my favorites is when people say, "Oh, but look at the ratio of global trade growth to global GDP. Global GDP is rising faster than the growth in trade." But the reason that's happening is because domestic economies are growing very fast. That's a wonderful thing to celebrate.

If it means that statistically the ratio of trade growth to GDP growth is a little bit lower, it doesn't mean that globalization is dead, for God's sake.

For every statistical sleight of hand that someone will deploy to pretend that globalization is dead, there are usually 10 good reasons why that's not true. At the end of the day, it's about the volume of flows, and the volume of flows is profound.

It may rise and fall. I mean, the United States has practically closed its border. Net migration into the United States this year could be zero. Is it going to be that way forever? No, it's not.

In the big picture, in the grand scheme of things, globalization will outlive all of us. It will be alive and well long after we're gone. I don't worry about it at all.

Keith 00:42:34

To add to your point, I think part of the problem is also that you don't have the right tools to sometimes capture the true impact or profound influence of globalization. So a good example is when I spoke to Marc Levinson, he was saying that if you think about the world we live in today, we primarily trade in ideas. If you think about the kind of idea flows or even digital products or digital goods and services, you're maybe watching a YouTube video that's produced in the US, but you're watching it here in Singapore. That's an example of globalization at play. And just because you can't capture it in terms of a GDP figure or you can't capture it in a metric doesn't mean that it's dead. And sometimes people have too much of an alarmist view of globalization.

Parag  00:43:20

Again, oversimplified, reductionist metrics that are either irrelevant or really peripheral to the bigger story are crucial. Again, you will have these conversations that will ignore digital flows, that will ignore migration, that will ignore flows of ideas. All of that is globalization too.

Again, it's one of these things, just like geopolitical conversations being dominated by Washington think tanks, economic conversations dominated by trade theorists. It's barely relevant to reality.

Keith 00:43:51

So if I can ask another question which is related to what you've talked about so far, it will be the question of migration. There is a lot of anti-immigration sentiment bubbling up, I think, in the West. And you actually forcefully argue that migration patterns will not only stay at current levels, but they will accelerate. And more Asians will interestingly migrate up north. My question to you is, can you just give us a sense of the argument? Why do you have such a strong view of why migration will continue to happen at such a breakneck pace despite the current sentiment?

Parag  00:44:34

Because it is happening at a breakneck pace despite the current sentiment. And again, the point of departure for any conversation about migration cannot be the fact that Giorgia Meloni in Italy is against migration. Why would you begin the conversation citing a random European nobody, or even Trump for that matter? He's not global sentiment.

Fact number one: most of the human species is Asian. Most migration is not Westerners but non-Westerners. So let's begin the conversation with the right premise. Where the majority of human beings are going is the numerical basis for this conversation.

The fact is that Asians are everywhere. Our diasporas are growing. Our migration is growing. If Asians are not landing in America tomorrow, then they're landing in Canada. If they're not landing in Canada, they're landing in Germany. They're already the majority of the populations in the Gulf countries. Then Asians within Asia—the largest movement of human beings in the world is just Asians within Asia.

So I don't care for the next one month, two months, six months if there's an anti-immigration sentiment in, say, France. That's not the world. The world is not turning against migration. The world has embraced migration. It has for a good 300 years. And that's a pretty strong track record.

I like to remind people, even in the West where you do have anti-migration sentiment, that as a global community, we're pretty bad at peace and stability. Centuries of world wars. We're pretty bad at managing or achieving global economic equity—huge inequality, big gap between rich and poor in the world. We're also really bad at managing the global environmental commons. Climate change has run amok, is out of control.

So we're bad at peace and security. We're bad at economic equity. And we're bad environmental stewards. You know what we're really damn good at? Mass migration. Mass migration—the one thing we do best as a global community, despite obviously all of the intervening factors: genocides, expulsions, wars, suppression, anti-immigration sentiment, walls, borders.

Despite the world having more borders than can possibly have ever existed in recorded history—200 sovereign states—we have more migration than ever. Three hundred million people live outside their country of origin. Each year, more than 1 billion people cross borders, getting on planes, trains, and automobiles for business, travel, tourism. These are all record numbers in the history of the world, and we break those records every single year.

This year, like COVID 2020, might be a blip, might be an aberration because of some setbacks. In the grand scheme of things, the law of supply and demand always wins. Aging, elderly societies need young people to pay taxes, to care for the elderly, to pay rent, to occupy the positions in the workforce, to collect the trash, you name it.

Even when robots do it, unless you tax the robots, you're still going to need migrants. And when I look at Western politics, very often when you're writing a book, it's over a multi-year period and governments change in the course of writing a book. So it's like, "Oh, but this government did this, and then they changed their mind, and then they changed their mind, and then they changed their mind." And you haven't even finished your book, and you realize, you know what? Just look at the numbers, and they keep going up.

Even when you have—look at Brexit, best example that totally proves my point. Look at Brexit. 2016, almost 10 years since Brexit. Can you tell me whether or not Britain has more or less migrants in 10 years?

Keith 00:48:20

A lot more.

Parag  00:48:20

So thank you. End of debate.

Keith 00:48:27

If you look at the patterns of migration, I think you've detailed and documented it a lot. You talk about Chinese and Indian diasporas forming. Singapore is a migrant society. A lot of our strength and our resilience and creativity, you could argue, comes from migrants themselves.

I wanted to ask you about the tradeoffs of migration. If you're a government, you're dealing with this. This is clearly an issue. Even in Singapore, despite being a migrant society, there is still anti-immigration sentiment. How should governments think about managing the challenges that come with migration?

Parag  00:48:58

So first of all, the idea that migration is a challenge or a threat to identity rests on the idea that there is one immutable identity synonymous with the ethnographic composition. You have one sense of what a Singaporean is and its identity, which we don't, fortunately.

But in other countries, let's say the sense of what is a German, what is French, they have a much more immutable sense of identity, and therefore any deviation or evolution from that is a threat to that. We have a much more open, expansive, flexible understanding of Singaporean identity.

And we view it as, of course, patriotism to the state, to our collective nation, rather than to any one ethnic identity. It's evolving. Yes, of course we have a vast majority Chinese population, but the underlying demographics are changing through immigration and so on.

So I think there are definitely two kinds of states: those that have this fixed, immutable identity and those that are more open. Cities in particular are the locus of this more flexible and pluralistic understanding of identity.

For example, even in countries that are heavily nationalistic and nativist right now, like the United States or Britain, look at New York and look at Los Angeles and look at London. You don't really have that kind of sentiment there.

So I have this map that shows the bubbles of cities in the world according to the percentage of the population that's foreign-born. And what you see in Los Angeles, Toronto, New York, Miami, London, Frankfurt, Berlin, Dubai, Hong Kong, Singapore, and Sydney—what do all those cities have in common? You've got anywhere from 25 to 90 percent of the population are foreigners. What else do they have in common? Those 10 cities are most of the world economy.

Every important place in the world, which is cities, which are the locus of the world population and world economy, is actually a thriving melting pot. Again, beginning, middle, and end, no debate.

Sure, national politics may be grappling with identity crises and issues because they're marginalized, peripheral, uneducated. I have plenty of sympathy with whatever the challenge is that they're facing in terms of their identity. But let's be clear that economic survival depends on these cities, and these cities are melting pots.

We are one of those urban melting pots. We know better than to retreat into nativism. I cannot help the fact that maybe the voters in Ohio feel left out by globalization. I mean, I could have helped it, and everyone else has written lots of books on why and how the US should have managed trade dislocation through domestic policy better, but it didn't. But the fact that that becomes a nativist issue is not actually a reflection on the threat to identity. It's a reflection on horrible policy.

So we need to be clear about that. The other is then one of vocabulary. There's a British journalist and academic, Philippe Legrain, who says we need to shift in vocabulary. We need to talk about locals and newcomers, not natives and foreigners, not parasitic invaders.

You're just a local who's been there for a long time. I'm a local in Singapore. I wasn't born here, but I'm a citizen of Singapore. I'm a local. I mean, may not sound like it, but you know me enough to know how proud I am of this country and how grateful I am to be here. I'm a local.

A newcomer is someone who's recently arrived, and they may not yet have PR or whatever the case may be, not be a citizen, but they're a newcomer, and we embrace them. A less controversial and provocative language around all of this is also important.

And a good society is one in which anyone can, in a very short amount of time, prove themselves to be a stakeholder, a loyal, patriotic resident, and become a local. And the places that welcome those people are going to be the winners because they're going to attract the talent, the innovation.

All of recorded history proves this. All of imperial history proves this. All of urban studies proves this. So I don't have any concern that the principles at stake are being invalidated or challenged. They're being validated, actually, by seeing the failure of places that are not embracing talent and diversity and pluralism.

Keith 00:53:44

You talk about the fact that it's horrible policies that cause this turn towards nativism. So then the question I have for you is, what are some good policies that governments should embrace, that should champion and adopt, so that the upsides of pro-immigration policy can actually create or foster inclusive growth for the country?

Parag  00:54:04

So there are silver bullets here, and they're very clear. This is a very concrete question you're asking, because very often a question like this gets answered with things like, "Oh, be open, be tolerant." Yes, of course, obviously. Okay, let me be really clear that there are very technocratic silver bullets to this, and I'm going to name them.

Number one: affordable housing. The number one problem in urban society across the entire planet Earth is affordable housing. If everyone has affordable housing, you will vastly diminish anyone's incentive to go nativist and maybe in an uproar.

The second is obviously maintaining low unemployment, which we do here in Singapore, which is very important as well.

Another is adequate education places, spots for students, both obviously locals and foreigners. In some countries, in England right now, they're saying, "Look, all these rich Asians are coming in and taking all the seats at Oxford and Cambridge. And we Brits, even if we get good scores, have to go to second-tier universities."

Well, why don't you expand the capacity? Why don't you just have more universities? We're tiny Singapore. We have five of the top universities in the world. So expand education opportunity, make it equitable, maintain low unemployment, absorb everyone into the labor force, and have affordable housing.

And there's more, but these are three. Get started on these three if you're not Singapore, and you'll do well. Even in Singapore, you kind of underappreciate how important these factors are, even though they're part of national policy and part of the national conversation.

Keith 00:55:38

You talk about how you have these huge diasporas popping up in all the big cities in the world. How would that reshape the world that we'll expect in, say, 2050?

Parag  00:55:50

Yeah, I mean, we are experiencing this demographic blending of human society, of human civilization, of our species, which resembles—I kind of close the Move book with this story of how 30,000 years ago you had a great collision of different human communities, proto-human communities, in the Siberian steppe, in the plateau of Central Asia, as Central and West Asians migrated eastward and Asians moved south, Southeast Asians moved northward.

And there was a collision in Siberia, and the genetic mutations that took place and the subsequent migrations over the across the Bering Strait, which became the native populations, the Native Americans of North America and even indigenous peoples of South America.

So you see there's common ancestry and DNA that you find in Andean communities and South American and Mexican communities and Native Americans of the United States and peoples of Siberia. And that traces back to 30,000 years ago.

So what we're seeing today with large-scale urbanization and the blending of peoples, one of the things I point out is, in places like Dubai and Singapore, you have—well, in Singapore we have Chindians. Nowhere else on earth do you have Chindians. And in the UAE you have Indipinos, Indians and Filipinos. And you may have Indipinos in Singapore too.

These racial mixtures literally did not exist until our generation, till now, because of urbanization. Then you have the mass migrations of Asians from south to north, and from east to west. So Asians all across North America, Asians all across Europe, Asians in the Gulf countries, now Asians moving northward into Central Asia.

I call it the reverse Mughal Empire. So the Mughal Empire is the result of the southward descent of everything from the Mongol and post-Mongol Tamerlane, Timurid empires, spun off the Mughals southward into the subcontinent to colonize the subcontinent. And now you have South Asians moving northward into the Central Asian steppes. So I call it the reverse Mughal Empire.

And you're going to have this demographic blending through intermarriage and so forth across the same geography where it happened 30,000 years ago. So there is this irreversible demographic blending that's already well underway. You can see it in cities, and you can even see it in these emerging markets. And that's going to continue for the next several decades.

And it's going to happen in a context where the world population is plateauing, remember. So this is all about where young people go today. And young people are on the move like never before, like no generation in the past. And young people are moving to cities. And young people are, from an identity standpoint, open and culturally tolerant, pluralistic. So they're more likely to intermarry.

Like in Singapore, map all of those things happening at the same time, and you get this great next round of genetic collision in which we'll be a much more diluted, we'll be a much more racially diluted species than we are today.

Keith 00:59:12

So everyone can expect to see more Chindians in Singapore, not just in Singapore but other parts of the world.

Parag  00:59:19

Absolutely. In the US, in China as well. You know that Taiwan is trying to lure Indian software programmers who wind up there. You've got Indians all over Germany. So you have German Indians. It's already happening. It's not sci-fi.

Keith 00:59:35

Well, yeah, more racially diluted. And by the way, just a great note on which country is best prepared for that world.

Parag  00:59:42

I'm hoping it's Singapore.

Keith 00:59:47

It is. It is. And I think that's good. I think on a couple of occasions you've said, we take certain things for granted. We don't have to think hard because they were achieved by the previous generations of leadership and society in Singapore. And they were, and that's a good thing. It's not that we should take things for granted, but it's wonderful that we can take for granted that in this emerging world where pluralism is a recipe for success, we have already baked that into our societal DNA.

Parag  01:00:18

Yeah, I know that in Singapore the intermarriage, the interracial marriage mix, has been increasing steadily, and it's the highest in the world statistically. No country comes anywhere close.

Keith 01:00:29

Interesting. Yeah. That's a great thing about Singapore.

Last question for you is, in this new world that we're entering, what is that one piece of advice you give fresh graduates entering this world?

Parag  01:00:46

To be mobile. I mean, when you think about the structural conditions of a slowing global economy and AI automation and the skills gap mismatch that many young people face, you have to be willing to go where the work is. It may not come to you.

There's a certain tier or class of professional that is a highly skilled software programming digital nomad, and they can live in Portugal or they can live in Sweden or they can live in Bali or whatever. That's a very small number of people.

The rank and file around the world have to be willing to physically go wherever the work is going to be. And because it is still true that being in a place where you face-to-face meet and network and try and rise up the ranks and so forth, that does matter. To be in the physical ecosystem still matters.

So I would say be mobile. Be prepared to go wherever you're asked to go. It's going to be a prerequisite for most people to succeed most of the time in most of the world.

Keith 01:02:01

Yeah. So for the young, it's not work from home. It's not even work from office. It's work from anywhere you can go.

Parag  01:02:06

Work—be—and I think that's the richness of life. I mean, I guess I'm somewhat old enough to be able to reflect and say it's served me well to never say no to an opportunity to relocate or to travel or to experience things firsthand. And it's not only been a blessing and enrichment, but it also, in a way, is good career advice because you really just never know where the opportunity is going to be.

So don't say no. Go where you need to be.