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Economic Cooperation in the Greater Mekong Sub-Region

Author

Listed:
  • Le, Binh Hai

    (Diplomatic Academy of Vietnam, Vietnam)

  • Nguyen, Dang Quyen

    (Centre for Applied Economics and Business Research, Vietnam)

  • Vu, Kieu Trang

    (Centre for Applied Economics and Business Research, Vietnam)

  • Luu, Hiep Ngoc

    (University of St Andrews, UK)

  • Taghizadeh-Hesary, Farhad

    (Waseda University, Japan)

Abstract

This paper investigates the impact of regional economic cooperation between Vietnam and its partners during the 2000-2015 period, focusing on the Greater Mekong Sub-region (GMS). Overall, the GMS represents a significant portion of Vietnam’s trade portfolio. China is the dominant trading partner in the GMS, exhibiting strong influence over Vietnam’s trade, especially its imports. However, using the gravity model of trade, we find that Vietnam has not benefited from GMS cooperation, as exemplified by its significant trade deficit, particularly with China. We further find that human capital enhancement and financial development are key factors to facilitate Vietnam’s trade, and mitigate its trade deficit with other GMS member countries. To this end, this study provides some important policy implications for the Vietnamese government as well as policymakers in other countries, when trading with larger partners in the context of regional economic cooperation.

Suggested Citation

  • Le, Binh Hai & Nguyen, Dang Quyen & Vu, Kieu Trang & Luu, Hiep Ngoc & Taghizadeh-Hesary, Farhad, 2020. "Economic Cooperation in the Greater Mekong Sub-Region," Journal of Economic Integration, Center for Economic Integration, Sejong University, vol. 35(2), pages 240-263.
    • Handle: RePEc:ris:integr:0798
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    More about this item

    Keywords

    Regional Economic Cooperation; Greater Mekong Sub-region; Vietnam; Trade; Gravity Model;
    All these keywords.

    JEL classification:

    • C23 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Models with Panel Data; Spatio-temporal Models
    • F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations
    • F15 - International Economics - - Trade - - - Economic Integration
    • O53 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Asia including Middle East

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