Gemma Bagayaua listened in to the lecture a filed a story on it for ABS CBN News.
To begin with, Asia has been chronically under-investing in critical sectors such as energy sector, pollution control, roads, public housing, ports, education, health and sustainable development, according to Sachs.
There is enough demand for goods and services in these sectors, he said, to offset declining consumer demand from US and Europe.
“This is still region of the world with the fastest growing population, with the most dramatic need for pollution control, for sustainable development, for accommodating migration of hundreds in suburban areas,” Sachs said.
These considered, public spending can have a very high social return apart from economic purpose right now “if it can be implemented in a responsible way,” he said.
Sachs noted that Asia has no balance of payment constraints, no inflation constraints, and no credit constraints that could stop the region from spending its way out of the crisis.
What has been preventing governments from the spending more on these sectors, Sachs noted, is lack of long-term financing, which Japan, with its ample reserves and strong currency can easily provide.