EU-Asia Free Trade Areas? Economic and Policy Considerations
AbstractThis paper analyzes key aspects of the changing economic relationship between the European Union (EU) and Asia, and explores the potential economic ramifications of deeper EU-Asian economic cooperation. The author investigates the possible costs to the EU of remaining “disengaged” from the Asian integration process and the likely impact of multi-nested EU-Asian trade agreements. His empirical review of CGE models revealed trivial effects of several possible EU-Asian accords (e.g., EU-India, EU-ASEAN, EU-Republic of Korea). In part, this is a result of relatively small trade shares, open markets, and restrictions in the models, particularly in that they excluded behind-the-border effects. He also presents two CGE models that estimate the potential negative effects of Asian/Asia-Pacific regional accords on the EU, and likewise found small effects. Nevertheless, using a highly-disaggregated (partial-equilibrium) approach, he argues that high-quality FTAs in Asia could be quite detrimental to the EU, particularly in key sectors. The push toward a Free Trade Area of the Asia Pacific could be particularly worrisome to the EU. It is therefore concluded that it makes sense for the EU to be more aggressive in pursuing prospective trade agreements with Asia.
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Bibliographic InfoPaper provided by Asian Development Bank Institute in its series ADBI Working Papers with number 255.
Length: 27 pages
Date of creation: 06 Dec 2010
Date of revision:
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More information through EDIRC
asia eu economic cooperation; asia eu trade; free trade areas;
Other versions of this item:
- Michael G. Plummer, 2010. "EU-Asia Free Trade Areas? Economic and Policy Considerations," Trade Working Papers 23282, East Asian Bureau of Economic Research.
- Michael G. Plummer, 2010. "EU-Asia Free Trade Areas? Economic and Policy Considerations," Governance Working Papers 23282, East Asian Bureau of Economic Research.
- Michael G. Plummer, 2010. "EU-Asia Free Trade Areas? Economic and Policy Considerations," Trade Working Papers 23125, East Asian Bureau of Economic Research.
- F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations
- F15 - International Economics - - Trade - - - Economic Integration
This paper has been announced in the following NEP Reports:
- NEP-ALL-2010-12-18 (All new papers)
- NEP-EEC-2010-12-18 (European Economics)
- NEP-INT-2010-12-18 (International Trade)
- NEP-SEA-2010-12-18 (South East Asia)
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Michael G Plummer & Ganeshan Wignaraja, 2007. "Integration Strategies for ASEAN: Alone, Together, or Together with Neighbors," Economics Study Area Working Papers 92, East-West Center, Economics Study Area.
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