This book on East Asian cross-regionalism has sought to answer three important questions. Why have East Asian countries embarked on cross-regionalism in an early stage of their FTA ventures? Why have East Asian governments selected specific extra-regional partners? And, in which ways are cross- and intra-regional trade initiatives linked? Throughout the chapters, we discussed both common and unique motivations behind the region’s CRTAs. In this concluding chapter, we examine the global trade environment for the region, summarize several patterns of East Asian CRTAs, and finally discuss their implications to our conceptual understanding of the process of regional integration and the policy implications of FTA proliferation. The analysis from the country case chapters, based on the framework discussed in the introduction chapter, provides a gateway into understanding the region’s FTA boom. Before summarizing the findings from the country analyses, however, it is important for us to lay out the regional and global political economic context of East Asia’s CRTA interests.
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References
“Competitive liberalization” became a part of US FTA strategy under the Bush Administration, as former USTR Robert Zoellick put this idea forward in 2002. Robert Zoellick (2002) “Special Report: Unleashing the trade winds” The Economist. December 7, 2002. Vol 365, Issue 8302: 26.
The most well-publicized of which, of course, is the World Bank publication of “East Asian Miracle” in 1993. The World Bank (1993) East Asian Miracle: Economic Growth and Public Policy. Oxford University Press, Oxford.
The most notable work on this discussion is by Stephan Haggard (1991) Pathways from the Periphery: The Politics of Growth in the Newly Industrializing Countries. Cornell University Press, Ithaca, NY.
Immanuel Wallerstein’s (1980) develops this long-term historical perspective. The Modern World-system II: Mercantilism and the Consolidation of the European World-Economy. Academic Press, New York, 1600–1750.
5 Peter Katzenstein (2005) A World of Regions: Asia and Europe in the American Imperium. Cornell University Press, Ithaca NY.
Representative work includes Andre Gunder-Frank (1985) The Development of Underdevelop-ment. Monthly Review. 41, 2. Henrique Cardoso and Enzo Faletto. (1979) Dependency and Development in Latin America. University of California Press, Berkeley.
Wade (2004) discusses the Taiwanese state’s role as gatekeeper. Robert Wade (2004) Governing the Market: Economic Theory and the Role of Government in East Asian Industrialization. Princeton University Press, Princeton.
For a contrast on the different paths that trade and financial integration are adopting in East Asia see Saori N. Katada and Mireya Solís (2008) “Under Pressure: Japan’s Institutional Response to Regional Uncertainty”. In: Vinod Aggarwal, Min Gyo Koo, Seungjoo Lee, and Chung-in Moon (eds.). Northeast Asian Regionalism: Ripe for Integration? Springer Berlin.
Katzenstein (2006) In: Peter J. Katzenstein and Takashi Shiraishi (eds) Beyond Japan: The Dynamics of East Asian Regionalism. Cornell University Press, Ithaca: 4–14.
APEC’s approach is described as “open regionalism”. For a discussion of the defensive attitude of Asian member countries that pervaded APEC, see John Ravenhill (2001) APEC and the Construction of Pacific Rim Regionalism. Cambridge University Press, Cambridge: 79–84.
Naoko Munakata (2006) Transforming East Asia: The Evolution of Regional Economic Integration. Brookings Institute Press, Washington DC: 77–79.
For a discussion of the dramatic increase in economic regionalization in East Asia through vertical and horizontal intra-industry trade, see Munakata, Chap. 3.
Many scholars have discussed the phenomenon of Japan-led regionalization and globalization of East Asia since the 1980s. The most representative works are by Hatch and Yamamura (1996) Asia in Japan’s Embrace: Building a Regional Production Alliance. Cambridge University Press, Cambridge and Katzenstein and Shiraishi (1997) Beyond Japan: The Dynamics of East Asian Regionalism. Cornell University Press, Ithaca NY.
Tachiki (2005) argues, however, that the push for FDI into Southeast Asia had already started before 1985. Dennis Tachiki (2005) Beyond Foreign Direct Investment and Regionalism: The Role of Japanese Production Networks. In: T. J. Pempel (ed) Remapping East Asia: The Construction of a Region. Cornell University Press, Ithaca: 149–169.
Baldwin (2006) especially Fig. 3 on page 8 and Fig. 4 on page 9. Richard E. Baldwin (2006) Managing the Noodle Bowl: The Fragility of East Asian Regionalism. Center for Economic Policy Research Discussion Paper 5561.
For example, Kimura, Takahashi and Hayakawa report that applied MFN tariffs on machinery and transport equipments were reduced from above 10% in 1988 to below 5% in 2001 for most of Southeast Asian countries. Kuranari Kimura, Yuya Takahashi and Kazunobu Hayakawa (2005) “Fragmentation and parts and components trade: a comparison of East Asia and Europe”, Mimeo: http://www.apeaweb.org/confer/hito05/papers/kimura_etal.pdf (accessed October 14, 2007) cited in Baldwin (2006): 9.
Of course, Bhagwati (1995) coined the original label “spaghetti bowl” to describe the phenomenon of complex web of overlapping bilateral FTAs in the world. Jadish Bhagwati (1995) “US Trade Policy: The Infatuation with Free Trade Areas”. In: J. Bhagwati and Ann O. Krueger (eds) The Dangerous Drift to Preferential Trade Agreements. Washington DC: American Enterprise Institute for Public Policy Research. Baldwin (2004) adopted the term to East Asia, calling the same phenomenon “noodle bowl”. Richard E. Baldwin (2004) “The Spoke Trap: Hub and Spoke Bilateralism in East Asia”. Korea Institute for International Economic Policy, Seoul.
Baldwin (2006) used the term “fuzzy” to describe how the three apparent trading “blocs” of EU, NAFTA and East Asia have very undefined boundaries. Richard E. Baldwin (2006) “Multilatera-lising Regionalism: Spaghetti Bowls as Building Blocs on the Path to Global Free Trade”. The World Economy. December: 1451–1518.
The same reservation applies to the efforts of Thailand and Korea noted above to position themselves as trade hubs: access to their FTA network is contingent on the compliance with different rules of origin.
For the gains and control trade-off, see Saadia M. Pekkanen, Mireya Solís and Saori N. Katada (2007) “Trading Gains for Control: Forum Choices in International Trade and Japanese Economic Diplomacy”. International Studies Quarterly. 51, 4. For a discussion of the dynamics where losses and losers tend to activate policy actions in economic policy making, see Katada and Solís (2006) “Domestic Source of Extra-Regional Foreign Policy Activism: Case of Japan” presented at International Studies Association Annual Convention, March 21–15 and also Baldwin (2006, Multilateralising Regionalism: 1469.
Baldwin (2006, Multilateralising Regionalism): 1501.
22 Baldwin (2006, Multilateralising Regionalism): 1508.
In other words, the desire to negotiate with an extra-regional bloc (such as the EU) may create an incentive for greater intra-regional coordination to facilitate inter-regional negotiations. The ASEM meeting is one of the best known examples, but it has not made significant progress on the trade negotiation front. See Vinod K. Aggarwal and Edward A. Fogarty (2004) “Between Regionalism and Globalism: European Union Interregional Trade Strategies” In: Aggarwal and Fogarty (eds) EU Trade Strategies: Between Regionalism and Globalism Palgrave McMillan and Julie Gilson (2001) “Europe–Asia: The Formal Politics of Mutual Definition”. In: Peter W. Preston and Julie Gilson (eds) The European Union and East Asia: Interregional Linkages in a Changing Global System, Cheltenham, UK and Northampton MA: Edward Elgar.
Interview with a trade expert involved in the government’s policy and research committees in Japan, July 2007, Tokyo, Japan.
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Katada, S.N., Solís, M. (2008). Cross-Regional Trade Agreements in East Asia: Findings and Implications. In: Katada, S.N., Solís, M. (eds) Cross Regional Trade Agreements. The Political Economy of the Asia Pacific. Springer, Berlin, Heidelberg. https://doi.org/10.1007/978-3-540-79327-4_7
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