• East Asian Economic Review
• /
• v.17 no.4
• /
• pp.385-415
• /
• 2013

Inter-regional free trade agreements (FTAs) - notably between Asia and Latin America - are growing in numbers and complexity. There is an absence of an agreed methodology for empirical assessments on the content of FTAs and little research. This paper proposes a framework to assess liberalization in FTAs in goods and services and new trade policy issues relating to regulatory barriers. Next, it applies this framework to studying the 22 Asia-Latin America FTAs in existence. The findings suggest that Asia-Latin American FTAs have laid the foundations for inter-regional integration by liberalizing the trade in goods and services and reducing some regulatory barriers. Deepening FTAs and adopting structural reforms will enhance Asia-Latin American integration in the future.

• East Asian Economic Review
• /
• v.20 no.2
• /
• pp.129-168
• /
• 2016

The Asia-Pacific region is not typically seen as one geographic or socio-economic space. Yet, 58 regional economies occupying the space of 28 million square kilometers from Turkey in the West, Russian Federation in the North, French Polynesia in the East and New Zealand in the South belong to the Economic and Social Commission of Asia and the Pacific (ESCAP). This commission provides a forum for member states that "promotes regional cooperation and collective action, assisting countries in building and sustaining shared economic growth and social equity". In 2013, ESCAP's members adopted the Bangkok Declaration to enhance efforts towards deeper regional economic integration. Yet this document neither proposes a concrete modality or modalities of achieving deeper integration, nor provides a sense of distance of individual countries to a "perceived" integrated Asia-Pacific.This paper aims to comprehensively quantify recent integration efforts of economies in the Asia-Pacific region. We provide an "index of integration effort" based on twelve metrics that measure the relative distance of a given economy to the region as an economic entity. Generally, we find that while the region has trended towards becoming integrated in general, both the level of integration and integration effort are inconsistent among Asia-Pacific economies. We discuss potential applications and extensions of the index in developing our perspective of the region's economic and social dynamics.

• East Asian Economic Review
• /
• v.17 no.4
• /
• pp.333-359
• /
• 2013

Two mega-regional negotiations are changing the landscape of Asia Pacific trade policy: an Asian track centered on ASEAN (the Regional Comprehensive Economic Partnership or RCEP), and a Trans-Pacific track centered on the Trans-Pacific Partnership (TPP) among 12 economies, including the United States, which Korea is expected to join. Modeling results suggest that both would generate substantial benefits for Korea and the global economy. From Korea's viewpoint, the agreements would establish new FTAs with China, Japan and smaller economies, improve the utilization of FTAs by permitting the regional cumulation of inputs, and help to upgrade some Korean FTAs to more rigorous standards. By participating in these agreements, Korea could also help to guide them toward inclusive, high-quality regional outcomes. As one of the region's most open and agile economies, Korea has a large stake in regional integration and would be well advised to pursue both tracks.

• East Asian Economic Review
• /
• v.18 no.2
• /
• pp.163-186
• /
• 2014

This paper argues that the formation of regional integration frameworks can be best understood as a dominant state's attempt to create a preferred regional framework in which it can exercise exclusive influence. In this context, it is important to observe not only which countries are included in a regional framework, but also which countries are excluded from it. For example, the distinct feature of the Trans-Pacific Partnership (TPP) is its exclusion of China, and that of the Regional Comprehensive Economic Partnership (RCEP) is its exclusion of the United States (US). An exclusion of a particular country does not mean that the excluded country will perpetually remain outside the framework. In fact, TPP may someday include China, resulting from a policy of the US "engaging" or "socializing" China rather than "balancing" against it. However, the first step of such a policy is to establish a regional framework from which the target country of engagement is excluded.

• Asia-Pacific Journal of Business
• /
• v.11 no.4
• /
• pp.303-315
• /
• 2020

Purpose - The purpose of this study is to analyze Korea's trade relations centered on the Pacific Alliance (PA), a major economic integration in Latin America, and identify its problems and suggest measures that can be taken by the government and corporations to reinforce economic cooperation. Design/methodology/approach - To improve the level of contribution of the study, an empirical analysis is necessary. However, due to limited data access, the study will approach the topic of trade relations between Korea and the PA with various statistics and literature. Findings - First, there is an urgent need for changes in import-export goods between Korea and the PA, as trade is focused on specific items. Second, although foreign direct investment from Korea to the PA is centered in manufacturing and mining industries, there should be different investment strategies by countries and industries. Third, it is necessary to reinforce commercial cooperation. Korea currently has Free Trade Agreements with Chile, Peru, and Columbia, but not with Mexico, the largest trading partner among the PA. Therefore, Korea must take active measures to sign an FTA with Mexico, which has been put on hold. Research implications or Originality - Latin America has the most thriving market when it comes to Free Trade Agreements worldwide. With the official establishment of the Pacific Alliance (PA) in 2012, the economic integration of Latin America faced entirely new circumstances. Reinforcing economic cooperation with the PA is extremely important for Korea in terms of entering and dominating the Latin American market. However, there is still a lack of research on the Pacific Alliance, and corporations that aim to enter the Latin American market face difficulties due to lack of information. By investigating the Pacific Alliance and its prospects and analyzing the trade relations with Korea, this study will provide strategic measures for corporations that wish to enter the Latin American market.

• East Asian Economic Review
• /
• v.25 no.1
• /
• pp.33-71
• /
• 2021

Many different approaches and databases have been developed for the evaluation of non-tariff measures (NTMs) and free trade agreements (FTAs). This paper is devoted to the EU-South Korea agreement, which is the first 'second-generation' FTA of the EU, addressing a wide array of non-tariff policies. We review the evolution of NTM types applicable to the EU-South Korea trade relationship and the role of NTMs in ex-ante and ex-post analyses of the agreement. Subsequently a structural gravity model is employed to assess the value added of information on different aspects of FTAs and types of NTMs by evaluating their ability to predict the trade effects of the EU-South Korea FTA. Our results show that, when accounting for information on the components common in modern deep trade agreements, no additional trade effect is attributable to the EU-South Korea FTA. The evolution of NTMs differs considerably across indicators used, but trade predictions are hardly affected. Most specifications point towards a negative effect of bilateral differences in the number of technical barriers to trade (TBT) applied and sanitary and phytosanitary measures (SPS) against which trading partners issued complaints at the WTO.

• Fashion & Textile Research Journal
• /
• v.18 no.2
• /
• pp.139-148
• /
• 2016

There is an expanding global network of free trade agreements (FTA). High-quality, comprehensive free trade agreements play an important role to support global trade liberalization and are explicitly allowed under the World Trade Organization (WTO) rules. An FTA is an international treaty that removes barriers to trade and facilitates stronger trade and commercial ties that contribute to increased economic integration between participating countries. Korea benefits from the global FTA trend; however it has started and developed FTA negotiations later than other countries. Current FTA agreements exist with Chile, Singapore, EFTA, ASIAN, India, EU, Peru, USA, Turkey, Australia, and Canada; in addition, there are ongoing negotiations with China, Colombia, New Zealand, and Vietnam. FTA open up opportunities for the textile/clothing industry to expand businesses into key overseas markets. FTA improve market access across all areas of trade to help maintain and stimulate the competitiveness of textile/clothing firms. This study examines the expansion of free trade agreements in light of changes in the international trade environment and the status of the Korean textile/clothing industry. Korea's textile/clothing export/import products and concession of tariff, country of origin covered under Korea-US/China FTA are investigated to identify problems. This study provides practical and policy implications for the textile/clothing industry in regards to the Korea-US/China FTA.

• Journal of Korea Trade
• /
• v.25 no.6
• /
• pp.1-19
• /
• 2021

Purpose - This paper aims at analyzing the functions and effectiveness of the cooperation agenda in Free Trade Agreements (FTAs), focusing on the cases of Asian countries. This paper estimates the contribution of this agenda to the sustainable development in Asia by providing the 'side payment' of the economic integration that encourages foreign investment and change in global value chains (GVC). Design/methodology - This study analyzes the functions of the cooperation chapter in FTAs by applying the cooperative game theory and reviewing the structures of the related FTAs. Also, as an empirical study, the existing FTA provisions and related development assistant programs in Asia are reviewed in this paper, especially focusing on the FTAs signed by Korea. Findings - Our main findings can be summarized as follows: The drawback of the economic integration, which would be the imbalanced economic benefit, can be redressed by the cooperation chapter in FTAs functioning as a 'side payment'. Indeed, as the examples of Korean FTAs show, more foreign investment and the GVC expansion in Asian countries have been encouraged thanks to the implementation of the cooperation chapters. Originality/value - This paper attempts to find how a legally binding agreement would influence the cooperation agenda in Asia which has never been analyzed despite the increasing number of so-called 'cooperation' chapters in the FTAs.

• East Asian Economic Review
• /
• v.20 no.3
• /
• pp.279-309
• /
• 2016

The proposed Trans-Pacific Partnership (TPP) is a free trade agreement among 12 Pacific Rim countries whose joint gross domestic products (GDPs) account for 36 percent of world GDP and whose mutual trade accounts for approximately 24 percent of world trade. As for most proposed free trade agreements (FTAs), trade economists have provided ex ante computable general equilibrium (CGE) estimates to predict the trade, employment, and real per capita income effects of this agreement, such as ITC (2016). This paper-intended to complement these studies-examines the potential impacts of TPP beyond such traditional CGE estimates, taking a broader economic, governance, and historical perspective. First, we contrast these traditional CGE trade and welfare estimates that treat all firms within an industry as homogeneous with more recent CGE analyses that allow firms' productivities to be heterogeneous. We show that the latter models' trade predictions are much more consistent with ex post empirical evidence of average trade effects of FTAs. Second, empirical evidence now strongly confirms the existence of FTA "contagion." We review this evidence and show that predictive models of the evolution of FTAs indicate that the TPP should be formed. With China now having formed 12 FTAs and negotiating five new ones (including a sixteen member Asia-Pacific FTA), the United States would likely face considerable trade diversion without the TPP. Third, we examine empirical evidence on the likely further economic growth implications of FTAs by reducing firms' uncertainty over trade relations and trade policies. Fourth, we examine empirical evidence on the additional impact of FTAs on consolidating democratic institutions in countries. The TPP would likely help consolidate some of the less mature democracies. Fifth, we examine empirical evidence on the reductions of conflicts (and enhanced peace) between countries owing to the formations of FTAs. We conclude the paper noting that the potential net benefits to member countries of the proposed TPP extend well beyond the real income gains to households based upon traditional CGE models.

• East Asian Economic Review
• /
• v.26 no.1
• /
• pp.3-25
• /
• 2022

East Asia's Regional Comprehensive Economic Partnership (RCEP) came into force in 2022 as the world's largest free trade agreement. RCEP was concluded, signed and brought into force in the face of major international uncertainty and is a significant boost to the global trading system. RCEP brings Australia, China, Japan, South Korea and New Zealand into the same agreement with the ten member ASEAN group at its centre. It keeps markets open and updates trade and investment rules in East Asia, a major centre of global economic activity, at a time of rising protectionism when the WTO itself is under threat. The agreement builds on ASEAN's free trade agreements and strengthens ASEAN centrality. One of the pillars of RCEP is an economic cooperation agenda which has its antecedents in ASEAN's approach to bringing along its least developed members and builds on the experience of capacity building in APEC and technical cooperation under the ASEAN Australia-New Zealand Free Trade Agreement. There is an opportunity to create a framework that facilitates deeper economic cooperation that involves experience-sharing, extending RCEP's rules and membership at the same time as strengthening political cooperation. The paper suggests some areas that might be best suited to cooperation - that is confidence and trust building instead of or before negotiation - and discusses how non-members may be engaged and the membership expanded. Options such as multilateralising provisions and becoming a platform for policy convergence and coordinating unilateral reforms are canvassed.