"Asia's opening to the global market has propelled record economic growth and reduced income poverty in much of the region," the UN Development Program (UNDP) said in its 2006 Asia-Pacific Human Development Report.

The economy in the Asia-Pacific region, home to more than 60 per cent of the global population, expanded annually 7.9 per cent on average from 1980 to 1990, making it the fastest-growing region in the world .

Between 1990 and 2003, the region continued to grow 7.6 per cent a year, surpassing 5.4 per cent in South Asia, 2.7 per cent in Latin America and the Caribbean and 3.2 per cent in the Middle East and North Africa.

This rapid economic growth came in tandem with "steady trade liberalization," the UNDP said, adding Asian governments should take credit for implementing liberalization, including lowering tariffs.

At the same time, however, free trade widened income inequality in the region as globalization benefited well-paid, skilled workers rather than poor, unskilled laborers.

"Asia and the Pacific have embraced globalization but globalization cannot embrace the region's poor without determined action on the part of governments," said Hafiz Pasha, director of the UNDP's regional bureau for Asia and the Pacific.

Although free trade has helped reduce poverty, with the number of people living on less than one dollar a day falling by nearly a quarter of a billion, the UNDP said globalization "has exacerbated inequalities" within the region.

"One of the most disturbing outcomes is that for most developing countries in the region, a greater engagement with international markets has been accompanied by a rise in income inequality."

For poor countries, the textiles and clothing industry is the launch pad for their industrial development but the UNDP said competition from China was now threatening job opportunities in the poor nations.