Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search

 

Asia Is Closer, but Future Cooperation Will Be Hard Won

New Index Shows Asia Is Closer but Future Cooperation Will Be Hard Won

Manila, Philippines, 5 March 2013 – Asia has become increasingly integrated over the past decade, led by growing trade and tourism and, most recently, as the region faced down the global financial crisis and subsequent eurozone crisis, according to a new integration index published in the Asian Development Bank’s (ADB) latest Asian Economic Integration Monitor.

“Going forward, greater integration will be harder won as the remaining areas of cooperation are more complex,” said Lei Lei Song, Principal Economist in ADB’s Office of Regional Economic Integration. “Asia needs to avoid complacency and continue to work together in this post-crisis period.”

The report warns that the struggles of the eurozone and the fear of the contagion that accompanies greater integration could give Asia’s policymakers pause as they assess the way forward for their region.

The index, which monitors foreign direct investment, capital markets, output correlations, trade, and tourism across Asia, shows the level of integration rising from a base level of 100.00 in 2001 to a peak of 233.27 in 2010, when the region was collectively bracing itself against the eurozone crises. Preliminary data for 2011 shows the level of integration tapering off slightly to 192.22, still much higher than in 2007 when the global financial crisis was just beginning.

The biannual Asian Economic Integration Monitor notes that in addition to growing intraregional trade and tourism, capital markets have also become tighter knit. During the crises, cooperation stepped up a notch: ASEAN+3 countries acted in concert to expand the Chiang Mai Initiative Multilateralization, their regional financial safety net; India offered to finance a South Asian equivalent; and several countries expanded bilateral currency swap arrangements.

However, financial integration and labor mobility have lagged. There is a huge need for more national and cross-border infrastructure. And even on trade, there is much work to be done to deepen integration.

Tariffs have come down but other barriers to trade, such as border administration, are significantly constraining greater integration. Intraregional trade in services also faces many impediments. The impact of regional trade blocs such as the upcoming Trans Pacific Partnership and the Regional Comprehensive Economic Partnership is still unclear. They could compete or they may provide the building blocks for a global trade agreement.

The report’s theme chapter points to the need to unravel the profusion of overlapping free trade agreements. As of January 2013, Asia had 109 free trade agreements, up from only 36 in 2002, with another 148 in various stages of development. This plethora of agreements is both complex and costly for exporters to navigate and Asia should work to multilateralize the agreements to make the best bilateral agreements applicable to other trade partners.

More multilateralized agreements like the ASEAN Free Trade Area, which involves a growing number of countries in and outside of Asia, would increase global trade, and thus income gains, in the absence of a global trade deal, the report says.

ADB, based in Manila, is dedicated to reducing poverty in Asia and the Pacific through inclusive economic growth, environmentally sustainable growth and regional integration. Established in 1966, it is owned by 67 members – 48 from the region.

ENDS

© Scoop Media

 
 
 
Business Headlines | Sci-Tech Headlines

 


Stats: Auckland’s Population Falls For The First Time
In the wake of the COVID-19 pandemic, New Zealand’s population growth slowed down with Auckland recording a population decline for the first time ever, Stats NZ said today. “New Zealand saw slowing population growth in all regions... More>>



BusinessNZ: Third Snapshot Report Reveals $9.5 Billion Business Investment In Climate Action

Signatories to the Climate Leaders Coalition have committed to invest $9.5 billion over the next five years to reduce emissions from their businesses, as revealed in their third anniversary snapshot report released today... More>>

Digitl: The home printer market is broken
Printers are more of a security blanket that a serious aid to productivity. Yet for many people they are not optional.
Even if you don’t feel the urge to squirt ink onto dead trees in order to express yourself, others will insist on printed documents... More>>


Retail NZ: Some Good News In COVID Announcements, But Firm Dates Needed

Retail NZ is welcoming news that the Government is increasing financial support for businesses in light of the ongoing COVID-19 lockdown, and that retail will be able to open at all stages of the new “Covid Protection Framework... More>>

ComCom: Companies In Hot Water For Selling Unsafe Hot Water Bottles And Toys

A wholesaler and a retailer have been fined a total of $140,000 under the Fair Trading Act for selling hot water bottles and toys that did not comply with mandatory safety requirements. Paramount Merchandise Company Limited (Paramount) was fined $104,000 after pleading guilty in the Manukau District Court... More>>



Reserve Bank: Robust Balance Sheets Yield Faster Economic Recovery

Stronger balance sheets for households, businesses, financial institutions and the government going into the pandemic contributed towards maintaining a sound financial system and yielding a faster economic recovery than following previous deep recessions... More>>