East Asian Economic Integration Research Articles

“RCEP from the middle powers’ Perspective”

ABSTRACT East Asian countries signed the Regional Comprehensive Economic Partnership Agreement (RCEP) in November 2020. This paper demonstrates the importance of ASEAN centrality in East Asian economic integration and makes a preliminary assessment of the agreement in terms of the four expected roles: liberalization, rulemaking, reducing policy risks, and forming a pro-trade middle power coalition. The comparison with the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) reveals the strengths and weaknesses of RCEP. The paper emphasizes the importance of dynamic aspects of mega-FTAs after being in effect and claims that RCEP must be further developed as an evolving agreement.

The ASEAN Economic Community and the RCEP in the world economy

ABSTRACT The Association of Southeast Asian Nations (ASEAN) has been leading economic integration within many structural changes in the world economy. ASEAN, established in 1967, has promoted regional economic integration since 1976. It started to work toward realizing the ASEAN Free Trade Area (AFTA) in 1992 and the ASEAN Economic Community (AEC) in 2003. ASEAN finally established the AEC at the end of 2015. The AEC is the most developed and advanced economic integration in East Asia. ASEAN is deepening the AEC for the next goal, AEC 2025. ASEAN also led East Asian cooperation initiatives, including ASEAN+3 and ASEAN+6, and ASEAN+1 FTAs. ASEAN proposed the Regional Comprehensive Economic Partnership (RCEP) and led the RCEP negotiations. Currently, rising protectionism and the US–China trade friction has great negative impacts on ASEAN and East Asia. Furthermore, the outbreak of COVID-19 has done great damage to ASEAN and East Asia. ASEAN is responding to the COVID-19 pandemic and strengthening the AEC steadily amidst growing protectionism and COVID-19 pandemic. The RCEP agreement was finally signed in November 2020. The RCEP is the first East Asian mega FTA. The RCEP has great meaning in ASEAN and East Asia. ASEAN secured ASEAN centrality in East Asian economic integration. The AEC and the RCEP will become more important amidst rising protectionism, and during and in the post-pandemic era.

How transboundary processes connect commons in Japan and Thailand: A relational analysis of global commodity chains and East Asian economic integration

In this paper, with a focus on Japan and Thailand, we outline a relational environmental and economic history of East Asian economic integration (EAEI) and its implication for the commons in both places. We draw attention in particular to global commodity chains as relational processes not only of trade and investment, but also geopolitics and aid, to argue that these transborder processes have connected together commons in distant localities resulting in their simultaneous enclosure, dispossession and (re‐)commoning with implications for community vulnerabilities in positive and negative ways. To demonstrate this argument we analyse three periods of EAEI: the late nineteenth century until World War II, when Japan and Thailand both began to modernise and new trade and geopolitical relations emerged in the context of colonialism; the post‐World War II recovery until the Plaza Accord in 1986, during which time Japan rapidly industrialised, as did Thailand to a lesser extent and regionalism was largely defined by US hegemony; and the post‐Plaza Accord period, when Japan deindustrialised its labour intensive manufacture and heavy industry and Thailand rapidly industrialised and EAEI became defined by new and intensified global commodity chains.

Comment: East Asian Economic Integration and the Prospect of a Liberal Economic Order

Comment: East Asian Economic Integration and the Prospect of a Liberal Economic Order

The political economy of preferential trade arrangements: The case of Japan

ABSTRACTSupport for open trade regimes varies. We analyze Japanese survey data on individuals' preferences for TPP, unilateral import liberalization, and East Asian economic integration, and compare factors influencing policy preferences. First, despite the massive negative campaigns against TPP, 42.8% of individuals support Japan’s participation in TPP, vs. 21.1% against. Second, economic factors do matter for an individual in determining his/her policy preference over TPP. Third, noneconomic factors such as gender, age, access to accurate information, and attachment to hometown also feature as determinants. Fourth, although preferences over TPP and other policy options are positively correlated, some factors decrease TPP support but do not undermine support for two other less-politicized policy options: lack of access to accurate information and some industry and regional TPP-specific factors. Criticism impacts negatively on FTA policy preferences. Finally, we discuss economic policy implications for relationships between China, Japan, and Korea.Abbreviations: FTA: Free trade agreement; JA: Japan agricultural cooperative; TPP: Trans-Pacific partnership agreement.

The internationalization of the RMB: a perspective vis a vis East Asian economic and financial integration

The People’s Republic of China has achieved remarkable progress in the internationalization of the RMB by introducing a number of concrete measures to boost the RMB’s status on the world stage since 2009. The ongoing RMB internationalization is being promoted under the background of deepening economic and financial integration in East Asia. In this article, we attempt to analyse RMB internationalization from the perspective of East Asian regional integration. We hypothesize that East Asian regional integration lays a broad foundation for China to push RMB internationalization forward. An internationalized RMB, we argue, will play more important roles in the process of East Asian regionalization. Thus, RMB regionalization could be an important and necessary step of internationalization. The Chinese authorities should not only push the RMB toward internationalization under China’s framework of domestic financial system reform, but they should also integrate RMB internationalization into the process of East Asian economic and financial integration. Therefore, a win–win strategy of RMB internationalization for both China and East Asian countries is needed.

An Analysis on the Correlation Between RMB Exchange Rate Fluctuation and East Asian Exchange Rate Fluctuations

Before 2005 July 21st, RMB exchange rate was pegged to US Dollar and adopted a fixed exchange rate. The correlation between RMB exchange rate and exchange rates of other East Asian economies was not significant. Empirical findings indicated that since Mainland China changed its exchange rate regime to a basket of currencies on July 22nd, 2005, in addition to the insignificant correlation between RMB exchange rate and exchange rates of Hong Kong, Malaysia, Thailand, and Indonesia duration the certain period, the correlation between exchange rate fluctuations of RMB and other East Asian economies is significantly related. This shows that the exchange rate regime of East Asian economies is mostly pegged to a basket of currencies. In order to avoid effects of exchange rate fluctuations from other countries on trade interests, exchange rate fluctuations of East Asian economies have a clear regional linkage. However, Mainland China’s exchange rate policy is gradually becoming more open, causing RMB exchange rate fluctuations to become an important reference for overall exchange rate structure in East Asia. RMB internationalization will continue in the future, cross-border trade with RMB settlement increasing, and RMB offshore market size will also expand. And currently Mainland China is leading East Asian economic and trade integration; hence RMB exchange rate fluctuations will have a significant impact on exchange rate fluctuations of other East Asian economies in the foreseeable future.

(De)Stabilizing Exchange Rate Strategies in East Asian Monetary and Economic Integration

The East Asian monetary integration process is at the crossroads. Given very benign liquidity conditions in the US, the prevailing common US dollar peg has contributed to growing macroeconomic and financial instability in the region. This has sparked demands to embark on an independent monetary integration process in East Asia. The paper shows that, however, neither the Japanese yen nor the Chinese yuan can challenge the US dollar as anchor currency in the region. Large fluctuations of the Japanese yen against the US dollar have undermined the potential of the Japanese yen to become a regional anchor currency. Exchange rate stability of the Chinese yuan against the US dollar has enhanced intra-regional exchange rate stability and growth, stressing the potential of the Chinese yuan to emerge as a regional anchor currency. Yet, it is shown that underdeveloped Chinese capital markets and financial repression originating in US low interest rate policies constitute an insurmountable impediment for the Chinese yuan to gain anchor currency status in East Asia. Empirical estimations provide evidence in favor of positive growth effects of the exchange rate stability against the US dollar in East Asia.

Study on the Relevance of the East Asian Economic Integration Model and Participating Strategy of Korea: Focusing on the Comparative Analysis of TPP and RCEP

Study on the Relevance of the East Asian Economic Integration Model and Participating Strategy of Korea: Focusing on the Comparative Analysis of TPP and RCEP

Studies on Economic Effect of East Asian Economic Integration and Trans-Pacific Partnership Agreement: Application of CGE Model and Game Theoretical Approaches

Studies on Economic Effect of East Asian Economic Integration and Trans-Pacific Partnership Agreement: Application of CGE Model and Game Theoretical Approaches

ASEAN and the Limits of Regionalism in Pacific Asia

After the Asian Financial Crisis (AFC) of 1997-99, a dominant orthodoxy arose both in regional diplomatic circles and the regional scholarship that analysed it, that the Association of South East Asian Nations (ASEAN) had established the institutional basis both for South East Asian as well as East Asian political and economic integration. Thus, at the beginning of the new millennium, Peter Katzenstein declared that East Asian regional integration was “an idea whose time has come.” Indeed, it was widely assumed that an expanded ASEAN machinery would “socialize the [East Asian] region with the same norms and values that have proved successful in Southeast Asia.”In view of these large claims about ASEANs apparent centrality to regional security in Southeast Asia, and its procedurally driven transformation of foreign relations across East Asia in the twenty-first century, the uncertainty among its diplomats and its academic admirers in the context of China’s rise and growing regional assertiveness represents something of a puzzle. To unravel this puzzle, we shall argue that ASEAN remains what it essentially was from its inception, namely an association of weak states created to achieve the limited purpose of maintaining regional order. Yet, even in this endeavour the arrangement has proved of limited effectiveness. Mean-while, its attempt to export its norms to the wider region have rendered it vulnerable to the incursion and hegemony of more powerful regional actors. To explore the limitations of Asian regionalism, the paper will focus on 2 areas of ASEAN policy formation since the AFC: the attempt to build an integrated ASEAN economic community and to establish a framework to address overlapping claims to the South China Sea. The dissonance between ASEANs rhetoric and its limited achievements in these areas leaves it increasingly sidelined by the evolution of great power rivalry in the Asia Pacific.

Negotiations for the Trans-Pacific Partnership Agreement: Evaluation and Implications for East Asian Regionalism

The Trans-Pacific Partnership (TPP) agreement seems to have reached a crossroads: it could either be a building block toward achieving economic integration in Asia and the Pacific, or trigger the formation of two large trade blocs which will work independently of one another. When the Government of Japan announced its participation in the TPP negotiations in March 2013, the partnership began to attract greater interest from other East Asian countries. This paper analyzes the progress and major issues regarding the current TPP negotiations which are being led by the United States, and draws implications for East Asian economic integration.

The TPP and East Asian Economic Integration: From the Japan–China–ROK perspective

This paper examines the influence Japan’s participation in the TPP negotiations will have on the course of subsequent East Asian economic integration, and mainly from the perspective of the three Northeast Asian countries of Japan, China and the ROK. In the first half, as a premise thereto, we first bring together the development of the FTA policies of China, the ROK and Japan, and then the connections with East Asian economic integration.

The TPP and East Asian Economic Integration: From the Japan–China–ROK perspective

This paper examines the influence Japan’s participation in the TPP negotiations will have on the course of subsequent East Asian economic integration, and mainly from the perspective of the three Northeast Asian countries of Japan, China and the ROK In the first half, as a premise thereto, we first bring together the development of the FTA policies of China, the ROK and Japan, and then the connections with East Asian economic integration.

Whither East Asian economic integration? Korea’s regionalization cum globalization strategy

The recent regionalization in East Asia can be defined in terms of regionalization cum globalization. In the case of Europe, regionalization was originally intended to create a preferential and protected area. From its inception, however, regionalization in East Asia emphasized open membership and global liberalization. This so-called open regionalism was then adopted as a fundamental principle of the Asia-Pacific Economic Cooperation (APEC). Given that APEC is an inter-regional institution, however, the concept of open regionalism is not applicable to characterize exclusively Asian integration process that gained momentum on the basis of the ASEAN + 3 framework. For many East Asian countries, a regionalization initiative, especially after the 1997 financial crisis, was a natural response to cope with globalization. Indeed, although East Asian economies are increasingly regionalized, the global market remains crucial and exclusively Asian arrangements are still rare. Globalization and regionalization processes are mutually reinforcing. Singapore is one example that developed into a regional economic hub through the regionalization cum globalization strategy. Given that Korea concluded recently two important free trade areas with the USA and the EU, Korea is also capable of building such a regional economic hub. The first step is to strengthen a cooperation network between the three Northeast Asian countries, China, Japan, and Korea. This network, together with ASEAN, is expected to catalyze the regional integration in East Asia and shape its future evolution.

Examining the Existence of Long-Run Relationships Between East Asian Economic Integration and ASEAN Tourism Exports

This paper examines the existence of long-run relationships between East Asian economic integration and tourism exports for nine selected ASEAN States for the period 1996-2007. I employ tourist arrivals data as a proxy for tourism exports and trade ratios as a proxy for the economic integration. Using Johansen’s Fisher panel cointegration test, the findings show that tourist arrivals and trade ratios are cointegrated in seven out of nine Southeast Asia countries. This suggests that East Asia economic integration can be one of the important factors that influence international tourism demand to ASEAN States in the long-run. However, for Laos and Thailand, the tourist arrivals and trade ratios are not cointegrated.

Globalization, Cultural Openness, and Public Preferences for East Asian Economic Integration in South Korea

Globalization, Cultural Openness, and Public Preferences for East Asian Economic Integration in South Korea

ECONOMIC INTEGRATION IN EAST ASIA: WHY WE NEED TO ACCELERATE REGIONAL INTEGRATION AFTER THE ECONOMIC CRISIS OF 2008-09

World trade dramatically expanded after the Second World War under the GATT system, which was succeeded by the World Trade Organization. The GATT sought a multilaterally increased world trade system. However, this system developed with a process of integration through regional agreements. This article focuses on microeconomic agents which promote regional economic integration and studies what agents have promoted the postwar integration. Researching into the theories of economic integration, this article focuses on the behavior of multinational corporations whose objective is to internalize their trade at the open markets. The multinationals seek economic integration because they want to completely cross tariff barriers, quotas and foreign exchange restrictions. This study tries to understand, from a political-economic point of view, the possibility of East Asian economic integration after the economic crisis of 2008-09.

M. Hadi Soesastro: Indonesian public intellectual, Asia Pacific visionary

This note commemorates and celebrates the life and contribution of M. Hadi Soesastro, a Bulletin board member who passed away on 4 May 2010. Hadi was arguably Indonesia's leading public intellectual in the fields of international economic policy and political economy, ASEAN economic cooperation, and East Asian economic integration. He made seminal contributions in these fields, and on the political economy of reform in Indonesia, the economic development of East Timor, and energy economics. He also played a major role in institutional development, most notably at the Centre for Strategic and International Studies, and in many other official, academic and research endeavours in Indonesia and East Asia.

The East Asian Economic Integration Regime and Taiwan

The East Asian Economic Integration Regime and Taiwan