This article first appeared in Forum, The Edge Malaysia Weekly on August 24, 2026 - August 30, 2026
Asia as a landmass accounts for 59% of global population, 29.8% of land area, 37.2% of trade (that is, it is No 1) and has a surplus of more than US$1 trillion against the rest of the world, mostly the US, largely due to oil and manufacturing output.
Asia produces in nominal gross domestic product roughly 36% of world GDP, but more than 50% in purchasing power parity (PPP) terms. It is the manufacturing powerhouse of the world and yet, collectively, it is not fully represented in global governance in terms of International Monetary Fund (IMF) quota votes (where it only accounts for 20%). The core global institutions were established at the end of World War II to represent the winners, but in 80 years, the demographics, economic output and trade have changed the order from a unipolar to a multinodal order. The nodes are beginning to think and act for themselves even as the commanding hubs lose their grip on global order.
How should global governance be changed to reflect a more balanced voice and representation for Asia? Because the current Western powers resist change to the existing institutions or want them to reflect their wishes, alternative regional groupings are emerging, such as the Asia Infrastructure Investment Bank (AIIB), AMRO (ASEAN+3 Macroeconomic Research Office, BIS mBridge and Cross-Border Interbank Payment System (CIPS), that are alternatives to the World Bank, IMF and SWIFT.
The intellectual leadership behind these regional changes are three key players in Asia — namely China, India and Asean — to which geopolitical thought leader Kishore Mahbubani gave the acronym CIA. This grouping together accounts for 3.5 billion people — nearly 44% of humanity and represents the fastest growth in nominal GDP output.
The current reality is that with only 20% of the voting power at the IMF, reforms to the international financial architecture can be blocked or outvoted by the US and European shareholders. According to Indonesian polymath Gita Wirjawan, to counter the West, the Rest must evolve their own narrative, which is beginning to emerge. The new narrative is a fundamentally different operating system on how the world works — one where the West, for all its intellectual firepower, is so engrossed with internal inconsistencies that it finds hard to accept. Hence, the West seeks to contain rather than to dialogue on what should be the way forward.
Each pillar of Asia’s rise expresses the new system in its own idiom and action.
China is the giant in the new emerging system. With the world’s largest economy by PPP and largest merchandise trade, its development model was shaped by its pragmatic tradition of “action before theory”. Its state-led industrial policy, experimental reform zones and massive infrastructure investments were not derived from the neoclassical Washington consensus model. They “crossed the river by feeling the stones” using pilot programmes at the city or special economic zone levels, observation, scaling what works, discarding what does not. When the West lectured China on the theoretical optimality of free markets, China was busy building the factories, ports and supply chains that now make it an indispensable trading partner of 120-plus countries, including doing US$1 trillion annual trade with Asean alone.
India is a counterweight to China, as the world’s most populous nation and fastest growing major economy. During the outbreak of the Ukraine war, India navigated West-Rest tensions through strategic autonomy — a deliberate refusal to be boxed into rigid blocs. It participates in the Quad with the US, Japan and Australia while simultaneously deepening energy and defence ties with Russia and championing Global South causes. India uses its Bharat “One Earth, One Family, One Future” narrative based on its ancient civilisation that understands that truth depends on circumstance. India’s US$151 billion trade relationship with China, currently its largest trading partner, despite a US$112 billion deficit and a festering border dispute, demonstrates its pragmatic flexibility. India did not sacrifice its economic interests to satisfy Western demands for ideological consistency.
Asean is an emerging intellectual and integrative hub. Its 10 nations, nearly 700 million people and US$4.4 trillion in trade and US$4.5 trillion in nominal GDP is fifth in terms of global GDP ranking and 4th in terms of PPP. The group is a pragmatic regional arrangement, bound not by grand ideology, but by consensus, incrementalism and a principle of non-interference. Asean’s “centrality” doctrine positions itself as the convener rather than the power broker, pushing new ideas such as the Regional Comprehensive Economic Partnership to the East Asia Summit that includes both the US and China without forcing a choice. This is organic governance in action: nurturing, rebalancing, waiting. Historically, Asean embodied cultural and technological inputs from India, China, the Middle East and the West to form its own unique diversity.
This trilogy of pathways has different goals, but shares a common rejection of the Western assumption that theory/ideology should precede action. For four centuries, the Western operating system has pursued theoretical optimality: build a logical model from first principles, derive the universal solution, implement it everywhere and if reality diverges, blame the inputs. Free trade was the ultimate expression of a liberal democratic individual rights model that was mathematically “proven” to maximise welfare. Free trade and minimal state intervention were self-evident truths. Unfortunately, deindustrialisation hollowed out the Western middle class and Chinese industrial policy leapfrogged entire industries. The cake grew bigger, but was shared unequally.
The Rest’s operating system treats the reality of radical uncertainty and trial by error as the practical alternative. Scan the context, try something small, observe what actually happens, scale what works and reiterate until the system works. It’s an engineering practicality that comes before universal truth. The map is never the territory. The map is often wrong as are theories by definition until reality proves the theory obsolete.
This divide runs through eight structural dimensions: the individual versus the group; universal principles versus contextual judgement; the mechanical versus the organic worldview; the impartial objective observer versus the embedded subjective actor; calculable risk versus radical uncertainty; linear progress versus path dependency; mind-matter dualism versus spiritual wholeness; and either/or versus entanglement (I am in you as you are in me).
The optimal-seeking West has been dismissive about the Rest’s fuzzy-wuzzy “cultural differences” because most of the Rest were former colonies or vassal states. Where the West tries to throw money at optimal solutions, Asia addresses unknown unknowns, be they pandemics, financial crises or technological disruption through pilot programmes for experimentation and iterative adaptation. As climate chaos, artificial intelligence disruption and geonomic competition prove that no model can pre-state all possibilities, the Asian playbook suddenly looks less like mumbo jumbo and more like common sense.
The proof of the pudding is in the acceptance by the West after years of denial that industrial policy is the new normal. In unknown unknowns, someone must choose. There is no free market to rescue you or infinite resources. Someone has to choose and take risks, where context and scarce resources matter.
How is the new global institutional architecture emerging? Asia has created the precursor to an Asian Monetary Fund from the ASEAN+3 swap lines, the AIIB for infrastructure and the Bank for International Settlements mBridge/CIPS for multi-currency settlements. These emerging institutional experiments are not replacing the post-war order. They are parallel architectures designed to complement it because the existing institutions — built for a transatlantic-centric world — cannot accommodate the reality that half of global GDP now comes from a bloc that has only one-fifth of the voting power.
None of this is to declare one operating system superior and the other obsolete. The Western axial tradition — individual rights, universal law, the scientific quest for objective truth — gave humanity modernity, freedom and the longest escape from poverty in history. The West gave us the internet that spreads universal knowledge to the world. But the Western system has hit its limits. The unipolar power cannot dominate the system because it has to continue borrowing to finance that role. The world has become so complex that no one power can compute the uncomputable. The old paradigm cannot see the interdependencies it cuts apart to analyse. It cannot accept that sometimes you must act before you know. It is action that reveals the unknown.
The future belongs to whoever can hold both systems in their head simultaneously: respecting universal principles without becoming their prisoner; respecting the individual without forgetting the group; building the model that best fits the context and resources while knowing that no model is forever. Above all, having the courage to step into muddy waters — to act, to learn and to change course when the truth finally reveals itself.
China, India and Asean are not just reshaping the global economy. They are challenging the West to rediscover what it once knew: that principles without pragmatism become dogma and that theory severed from practice becomes ideology. We are not watching the end of history. A new synthesis or order is unfolding and Asian pragmatism over ideology will be the pillars of that foundation.
Tan Sri Andrew Sheng writes on global issues from an Asian perspective.
This article is based on a lecture to the Asian Global Institute’s Asian Global Scholars on Aug 20.
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