The People’s Republic of China (PRC) stands to reap sizable gains from entering into free trade agreements (FTAs) with its neighbors. The authors qualitatively and quantitatively analyze the four main permutations of the PRC’s FTAs with the region’s major economies: PRC–ASEAN, PRC–Japan, PRC–Republic of Korea, and ASEAN+3. Their comparative analysis reveals that the PRC would gain from all three bilateral FTAs, while gaining the most from a larger region-wide FTA such as ASEAN+3. Read more.
When trade interdependence between countries is low, they tend to sign a shallow goods-centered agreement to boost trade between them. In contrast, when a high level of trade interdependence is already achieved and the economic interdependence structure between them is complex, a deep agreement that formalizes economic relations is required to avoid ad hoc political bargaining. Shintaro Hamanaka notes that this difference is the key to understanding the rationale of the noodle bowl of FTAs in Asia. Read more.
Next week in Baku, Azerbaijan, ministers from ten countries spanning the Caucuses, and Central, East and South Asia will gather to mark a decade of achievement, including $17 billion of investments in energy, trade and transportation under the Central Asia Regional Economic Cooperation Program (CAREC). Established in 2001, CAREC brings together Afghanistan, Azerbaijan, the People’s Republic of China (PRC), Kazakhstan, Kyrgyz Republic, Mongolia, Pakistan, Tajikistan, Turkmenistan, and Uzbekistan. It promotes the implementation of regional projects in energy, transport, and trade facilitation from northern PRC to the Caucasus and Europe, and from Kazakhstan to the warm water ports of Karachi, Gwadar and beyond. Read more. Visit the CAREC Institute website.
Economic growth in emerging East Asia will continue to moderate to 7.2% in 2012 from 7.5% in 2011—as growing sovereign debt problems in Europe and an anemic US economy raise the spectre of a deep global economic downturn, says the Asian Development Bank’s latest Asia Economic Monitor. In the event that both the eurozone and the US economies contract sharply, the impact on emerging East Asia would be serious yet manageable, the report says. Download report and press release. Watch video and listen to the podcast.
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