Dynamics of Trade Agreements, Trade and Investment in South, Southeast and East Asia

Abstract

South, Southeast and East (S, SE and E) Asian economies comprise a number of emerging economies that are significantly contributing to the world market. Asian economies are coming up with strong policy frameworks to strengthen trade and investment. Simultaneously, Asian economies (S, SE and E regions) are strategically negotiating a number of vital intra-regional as well as extra-regional trade agreements (RTAs) with an intent to not only boost trade but also to provide an environment for investors to stimulate foreign direct investment (FDI) flows. The study examined the trends and dynamics of regional integration, trade and investment in the said Asian region. The trend for RTAs indicates that economies in S, SE and E Asian regions have negotiated a significant number of bilateral and plurilateral trade agreements. Moreover, export values of three significant RTAs (Association of Southeast Asian Nations [ASEAN], Asia Pacific Trade Agreement [APTA], and South Asian Association for Regional Cooperation [SAARC] trading bloc) in the region suggest that export performance of ASEAN and APTA vis-à-vis intra-bloc and the world at large has been far better than the SAARC trading bloc. The dynamics of trade and investment suggest that East Asian economies are contributing a significant percentage to world trade and investment, and Southeast Asian economies are slowly improving trade and investment trends. However, Southern Asian economies need to revisit and revamp existing trade and investment policies to gear up trade and investment flows.