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How Restrictive Are ASEAN's Rules of Origin?

In: East Asian Integration (First Edition)

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  • Olivier Cadot
  • Lili Yan Ing

Abstract

We use a product-level gravity approach to estimate the effect of the Association of Southeast Asian Nations (ASEAN)’s product-specific rules of origin (ROO) on regional trade, using original data on rules applicable at the six-digit level of the harmonized system. Overall, we find that the average tariff ad-valorem equivalent (AVE) of ASEAN’s ROO is 3.40 percent across all instruments and sectors. The trade-weighted average is 2.09 percent. This moderate estimate is in line with the existing literature. However, we also find fairly high AVEs for some sectors including leather, textile and apparel, footwear, and automobiles. We also find that some rules are more restrictive than others; in this regard, the Textile Rule stands out as a relatively more trade-inhibiting rule than others.

Suggested Citation

  • Olivier Cadot & Lili Yan Ing, . "How Restrictive Are ASEAN's Rules of Origin?," Chapters, in: Lili Yan Ing (ed.), East Asian Integration (First Edition), chapter 5, pages 121-154, Economic Research Institute for ASEAN and East Asia (ERIA).
    • Handle: RePEc:era:chaptr:2014-rpr-6-5
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    1. ANDO Mitsuyo & URATA Shujiro, 2018. "Determinants of FTA Utilization for Japan's Imports: Preferential margins and restrictiveness of rules of origin," Discussion papers 18078, Research Institute of Economy, Trade and Industry (RIETI).

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