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Rules of Origin and Local Content in East Asia

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  • Kuroiwa, Ikuo

Abstract

Rules of Origin (RoO) are an integral part of all trade rules. In order to be eligible for Common Effective Preferential Tariffs (CEPT) under AFTA and similar arrangements under the ASEAN-China FTA, a product must satisfy the conditions relative to local content. The paper tries to calculate local content as well as cumulative local content in East Asian economies, with use of the Asian International Input-Output Tables; it also investigates factors of change in local content by applying decomposition analysis. The paper finds that the cumulation rule increased local content of the electronics industry more significantly than local content of the automotive industry, and the contribution of the cumulation rule increased in the period 1990-2000, due to rising dependency on neighboring ASEAN countries and China.

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File URL: http://ir.ide.go.jp/dspace/bitstream/2344/331/3/ARRIDE_Discussion_No.78_kuroiwa.pdf
File Function: First version, 2006
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Bibliographic Info

Paper provided by Institute of Developing Economies, Japan External Trade Organization(JETRO) in its series IDE Discussion Papers with number 78.

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Date of creation: Nov 2006
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Publication status: Published in IDE Discussion Paper. No. 78. 2006.11
Handle: RePEc:jet:dpaper:dpaper78

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Related research

Keywords: Rules of origin; Local content; International input-output tables; Southeast Asia; East Asia; China; ASEAN; Trade policy; International trade; International agreements; Manufacturing industries;

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Cited by:
  1. Wignaraja, Ganeshan & Olfindo, Rosechin & Pupphavesa, Wisarn & Panpiemras, Jirawat & Ongkittikul, Sumet, 2010. "How Do FTAs Affect Exporting Firms in Thailand?," ADBI Working Papers 190, Asian Development Bank Institute.
  2. Meng, Bo & Wang, Zhi & Koopman, Robert, 2013. "How are global value chains fragmented and extended in China's domestic production networks?," IDE Discussion Papers 424, Institute of Developing Economies, Japan External Trade Organization(JETRO).
  3. Meng, Bo & Fang, Yong & Yamano, Norihiko, 2012. "Measuring global value chains and regional economic integration : an international input-output approach," IDE Discussion Papers 362, Institute of Developing Economies, Japan External Trade Organization(JETRO).

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