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Regionalism as an Engine of Multilateralism: A Case for a Single East Asian FTA

Author

Listed:
  • Kawai, Masahiro

    (Asian Development Bank Institute)

  • Wignaraja, Ganeshan

    (Asian Development Bank)

Abstract

As East Asia becomes increasingly integrated through market-driven trade and FDI activities, free trade agreements (FTAs) are proliferating. Consolidation of multiple and overlapping FTAs into a single East Asian FTA can help mitigate the harmful noodle bowl effects of different or competing tariffs, standards, and rules. A region-wide FTA will also encourage participation of low-income countries and reduce trade-related business costs, particularly for small and medium enterprises. A computable general equilibrium (CGE) model examines the economic impact of various types of FTAs in East Asia (among ASEAN+1's, ASEAN+3, and ASEAN+6) finding that consolidation at the ASEAN+6 level would yield the largest gains to East Asia among plausible regional trade arrangements.

Suggested Citation

  • Kawai, Masahiro & Wignaraja, Ganeshan, 2008. "Regionalism as an Engine of Multilateralism: A Case for a Single East Asian FTA," Working Papers on Regional Economic Integration 14, Asian Development Bank.
    • Handle: RePEc:ris:adbrei:0014
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    Cited by:

    1. Fithra Faisal Hastiadi, 2012. "China-Japan-Korea (CJK)'s FTA Strategy towards ASEAN Countries: A Game Theoretical Approach," Working Papers in Economics and Business 201210, Faculty of Economics and Business, University of Indonesia, revised Oct 2012.
    2. 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.
    3. Ikumo Isono & Satoru Kumagai & Fukunari Kimura, 2012. "Agglomeration And Dispersion In China And Asean: A Geographical Simulation Analysis," China Economic Policy Review (CEPR), World Scientific Publishing Co. Pte. Ltd., vol. 1(01), pages 1-16.
    4. Iulia Monica Oehler-Şincai, 2014. "The Roles Played By China And Japan In The Asian Integration Process," Romanian Economic Business Review, Romanian-American University, vol. 9(3), pages 131-148, September.
    5. Kaliappa Kalirajan,, 2012. "Regional Cooperation towards Green Asia : Trade and Investment," Development Economics Working Papers 23291, East Asian Bureau of Economic Research.
    6. Fithra Faisal Hastiadi, 2012. "The Determinants of China-Japan-Koreas Vertical Intra Industry Trade to ASEAN4 countries," Working Papers in Economics and Business 201205, Faculty of Economics and Business, University of Indonesia, revised May 2012.
    7. Rigg, Robert & Schou-Zibell, Lotte, 2009. "The Financial Crisis and Money Markets in Emerging Asia," Working Papers on Regional Economic Integration 38, Asian Development Bank.
    8. Innwon Park, 2009. "Regional Trade Agreements in East Asia: Will They Be Sustainable?," Asian Economic Journal, East Asian Economic Association, vol. 23(2), pages 169-194, June.
    9. Innwon Park & Soonchan Park, 2009. "Free Trade Agreements versus Customs Unions: An Examination of East Asia," Asian Economic Papers, MIT Press, vol. 8(2), pages 119-139, Spring.
    10. Ketterer, Tobias D. & Bernhofen, Daniel M. & Milner, Chris, 2015. "The impact of trade preferences on multilateral tariff cuts: Evidence for Japan," Journal of the Japanese and International Economies, Elsevier, vol. 38(C), pages 31-51.
    11. Kim , Sangkyom & Park , Innwon & Park , Soonchan, 2013. "A Free Trade Area of Asia Pacific (FTAAP): Is It Desirable?," East Asian Economic Review, Korea Institute for International Economic Policy, vol. 17(1), pages 3-25, March.
    12. Sanchita Basu Das & Rahul Sen & Sadhana Srivastava, 2017. "A Partial Asean Customs Union Post 2015?," The Singapore Economic Review (SER), World Scientific Publishing Co. Pte. Ltd., vol. 62(03), pages 593-617, June.
    13. Innwon Park, 2011. "Is AFTA a Desirable Regional Trade Agreement for ASEAN?," International Area Studies Review, Center for International Area Studies, Hankuk University of Foreign Studies, vol. 14(4), pages 49-72, December.
    14. Yunling Zhang, 2010. "The Impact of Free Trade Agreements on Business Activity : A Survey of Firms in the People's Republic of China," Trade Working Papers 22721, East Asian Bureau of Economic Research.
    15. McKibbin, Warwick J. & Chanthapun, Waranya Pim, 2009. "Exchange Rate Regimes in the Asia-Pacific Region and the Global Financial Crisis," Working Papers on Regional Economic Integration 36, Asian Development Bank.
    16. Kalirajan, Kaliappa, 2012. "Regional cooperation towards green Asia: Trade in low carbon goods and services," Working Papers 249395, Australian National University, Centre for Climate Economics & Policy.
    17. Medalla, Erlinda M. & Balboa, Jenny D., 2011. "Regional Economic Integration in East Asia: Progress and Pathways," Discussion Papers DP 2011-23, Philippine Institute for Development Studies.
    18. Schou-Zibell, Lotte & Madhur, Srinivasa, 2010. "Regulatory Reforms for Improving the Business Environment in Selected Asian Economies - How Monitoring and Comparative Benchmarking Can Provide Incentive for Reform," Working Papers on Regional Economic Integration 40, Asian Development Bank.
    19. Fithra Faisal Hastiadi Author_Email:, 2011. "East Asian Regionalism: The Way Forward," 2nd International Conference on Business and Economic Research (2nd ICBER 2011) Proceeding 2011-153, Conference Master Resources.
    20. Kaliappa Kalirajan & Venkatachalam Anbumozhi, 2014. "Regional Cooperation Toward Green Asia: Trade in Low Carbon Goods," The International Trade Journal, Taylor & Francis Journals, vol. 28(4), pages 344-362, October.
    21. Thangavelu, Shandre M. & Narjoko, Dionisius, 2014. "Human capital, FTAs and foreign direct investment flows into ASEAN," Journal of Asian Economics, Elsevier, vol. 35(C), pages 65-76.
    22. Fithra Faisal Hastiadi, 2011. "East Asian Regionalism: The Need For Asean+3 Fta," Journal of Global Business and Economics, Global Research Agency, vol. 3(1), pages 31-56, July.
    23. Madhur, Srinivasa & Wignaraja, Ganeshan & Darjes, Peter, 2009. "Roads for Asian Integration: Measuring ADB's Contribution to the Asian Highway Network," Working Papers on Regional Economic Integration 37, Asian Development Bank.
    24. Yunling Zhang, 2010. "The Impact of Free Trade Agreements on Business Activity: A Survey of Firms in the People's Republic of China," Working Papers id:3015, eSocialSciences.

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    More about this item

    Keywords

    Free Trade Agreement; ASEAN; multilateralism;
    All these keywords.

    JEL classification:

    • F10 - International Economics - - Trade - - - General
    • F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations
    • F40 - International Economics - - Macroeconomic Aspects of International Trade and Finance - - - General

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