Regionalism in Global Trade

Regionalism in Global Trade

Dilip K. Das

This comprehensive book addresses one of the most important aspects of international trade, namely, regional trade and regional integration agreements (RIAs). The focus of intense global interest and debate over the last decade, RIAs have become an integral and enduring aspect of the multilateral trading regime. Dilip K. Das analyzes the latest trends, evaluates the pattern and gauges the progress of regional integration in the global economy over the post-war, and especially the contemporary, periods.

Chapter 5: Regionalism in Asia-Pacific

Dilip K. Das

Subjects: economics and finance, political economy, regional economics, politics and public policy, political economy, urban and regional studies, regional economics, regional studies


1. STRUCTURAL TRANSFORMATION OF THE ASIA-PACIFIC REGION Although approximately half of the trade is at present intra-regional, institutionalized regionalism was slow to put down its roots in Asia.1 Relative to other regions, the Asia-Pacific region was slow and late in catching on to the concept and phenomenon of regionalism. Asian policy makers ignored the institutional form of the concept for a long time. Economic growth in Asia has a certain characteristic pattern to it. Following a brief flirtation with the import-substituting industrialization strategy, over the preceding three-and-a-half decades, the high performing Asian economies adopted outward-oriented strategies, promoting trade and foreign investment. This led to brisk expansion of intra-regional trade and investment. Asia-Pacific regionalism was essentially market-led and uninstitutionalized. Regional production networks were the consequence of market-led economic dynamics of the region. Large corporations, including transnationals, contributed to the growth of the pan-Asian industrialization process (Chapter 3, section 3). Some institutional arrangements followed market initiatives, albeit with a substantial time lag. Some regional institutional initiatives were taken, which are presently operating with varying degrees of success. We shall see that empirical exercises, using a gravity model, concluded that East and Southeast Asian economies clearly show certain inward bias among themselves. Although this does apply to all, the dynamic economies of the Asia-Pacific region do seem to be natural trading partners.2 These regional initiatives not only coexist with globalism but also serve as stepping stones to multilateralism. A large body of research is available proving that trade and outward economic orientation were...

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