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A Free Trade Area of the Asia Pacific (FTAAP): Is It Desirable?

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  • Park, Innwon
  • Park, Soonchan
  • Kim, Sangkyom

Abstract

This paper evaluates whether the proposed FTAAP is a desirable policy option for APEC member economies and the world economy. More specifically, this paper quantitatively investigates whether the FTAAP satisfies conditions for a trade bloc to generate positive and sufficient net trade creation effect. In addition, this paper estimates the likely impact of the FTAAP by using a CGE model analysis. Based on statistical data analysis, this paper strongly argues that the FTAAP can be a desirable regional trade bloc able to generate positive gains from freer trade. From the ex-ante scenario analysis using both static and capital accumulation CGE Models, this paper concludes that the FTAAP has great potential for improving welfare of participating APEC economies and will boost economic growth in the region. In particular, the FTAAP would be even better if it can be linked with liberalization of trade in services and enhanced trade facilitation.

Suggested Citation

  • Park, Innwon & Park, Soonchan & Kim, Sangkyom, 2010. "A Free Trade Area of the Asia Pacific (FTAAP): Is It Desirable?," MPRA Paper 26680, University Library of Munich, Germany.
  • Handle: RePEc:pra:mprapa:26680
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    References listed on IDEAS

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    Cited by:

    1. Yu Sheng & Hsiao Chink Tang & Xinpeng Xu, 2014. "The impact of the ACFTA on ASEAN--PRC trade: estimates based on an extended gravity model for component trade," Applied Economics, Taylor & Francis Journals, vol. 46(19), pages 2251-2263, July.
    2. Shepherd, Ben, 2019. "Mega-regional trade agreements and Asia: An application of structural gravity to goods, services, and value chains," Journal of the Japanese and International Economies, Elsevier, vol. 51(C), pages 32-42.
    3. Wignaraja, Ganeshan & Ramizo, Dorothea & Burmeister, Luca, 2012. "Asia-Latin America Free Trade Agreements: An Instrument for Inter-Regional Liberalization and Integration?," ADBI Working Papers 382, Asian Development Bank Institute.

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    More about this item

    Keywords

    Regional Trade Agreement (RTA); APEC; FTAAP; Computable General Equilibrium (CGE); Trade in Services; Trade Facilitation;
    All these keywords.

    JEL classification:

    • F15 - International Economics - - Trade - - - Economic Integration
    • F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations

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