REGIONAL ECONOMIC INTEGRATION IN A GLOBAL FRAMEWORK.pdf

Abstract
AI

The paper discusses the dual trends of regionalization and globalization in the world economy, highlighting the complexities of regional economic integration across various global contexts. It emphasizes the importance of policy initiatives supporting regional agreements while ensuring they complement global integration efforts. Through insights gathered from a G-20 workshop, the paper raises critical questions regarding optimal integration pathways, the relationship between economic and institutional integration, and the necessity for openness and non-discrimination in fostering beneficial economic ties.

Figures (34)

Source: Compiled from European Communities (2003). * Treaty under which each institution or body was created. See Table A.1 in the Appendix fo information about these and other European treaties. Table 1: Regional institutions and other bodies in the european union

Source: Compiled from World Bank (2003c, Table 2.1, p. 68); data from COMTRADE, WITS, WTO. Note: Table presents the annual growth rates by product group and by country groups assigned on the basis of 1981 income levels to avoid the selection bias that results when end-of-period attributes are used as the basis for selection. Product definitions are supplied by the WTO. Data analysis undertaken in World Integrated Trade Solutions (WITS) using “mirror” data from UN COMTRADE. Country groups defined by income status in 1981. While the results from this approach must be treated with some caution, because the level of technology of the process involved is frequently more important that the technology level of the product, examining the nature of the products being traded is clearly of interest.

Source: Sakakibara and Yamakawa (2004, Figure 3.1, p. 82); calculated using data from World Bank World Development Indicators (various years) and IMF Direction of Trade Statistics Yearbook (various years). Figure 1: Trade Intensity Index — intraregional, 1980-2001

Source: Compiled from ASEAN (2002, tables 3.1.2-3.1.9). Note: Asian NIEs include Hong Kong (China), Korea, and Taiwan (China). Australasia is Australia anc New Zealand. Others include Bermuda, Canada, the Cayman Islands, India, and Pakistan, as well a: various Central and South American countries and a few others.

Table 3: Share of world trade in parts and components, 1992-2000 (percent) Source: Compiled from Athukorala (2003, Table 1, pp. 25); data from UN COMTRADE database. @ East Asia includes Japan and the developing countries. The developing countries include China, Korea, Taiwan (China), Hong Kong (China), and ASEAN (excluding Brunei Darussalam, Cambodia, Lao PDR, and Myanmar because of the lack of data). > Does not sum to 100 percent because some countries and regions are not included in the table.

Source: Compiled from Athukorala (2003, Table 1, pp. 30-31); data from UN COMTRADE database. Note: East Asia includes Japan and the developing countries. The developing countries include China, Korea, Taiwan (China), Hong Kong (China), and ASEAN (excluding Brunei Darussalam, Cambodia, Lao PDR, and Myanmar because of the lack of data).

Source: Compiled from Ng and Yeats (2003, Table 11, p. 36). Note: East Asia includes Brunei Darussalam, Cambodia, China, Hong Kong (China), Indonesia, Kore: Lao PDR, Malaysia, Mongolia, the Philippines, Singapore, Taiwan (China), Thailand, and Vietnan Between 1995 and 2003, China’s trade balances in machinery, electrical machinery, chemical products, and transportation equipment have become increasingly negative in the case of its nine Asian partners but increasingly positive in the case of the United States and the European Union.”* These findings indicate that China’s participation in production sharing is both regional and global. Participation in production sharing on these two levels is also the case for East Asia as a whole.

Source: Yusuf (2003, Table 7.4 p. 296) compiled from survey of firms in China and several other Eas Asian nations conducted by the World Bank during the spring of 2001. “ Firms in Indonesia, Korea, Malaysia, the Philippines, Singapore, and Thailand. Table 6: Prevalence of networking among firms in East Asia Of the non-Chinese firms surveyed, nearly one-quarter are internationally networked with 43.3 percent of those (or 10 percent of the total 326 firms) both importing parts and producing parts and final goods for foreign buyers. The results for Chinese firms in the survey are not quite as strong. Only 14.6 percent of these firms are internationally networked with just 32.2 percent both importing parts and producing parts and final goods for foreign buyers. Yusuf (2003) attributes the weaker result for the Chinese firms to China’s “relatively recent and ongoing integration into the world trading system.”””

Value of exports of parts and components (US$ million)

Share of exporter in total imports of the trading (percent)

Source: Compiled from Ng and Yeats (2003, Table 18.1, p. 58). * East Asia includes only 10 countries due to the lack of COMTRADE data for Brunei, Cambodia, Lao PDR, Mongolia and Vietnam in 2001. Trade balance of exporter

Table 8: Business activities of Japanese overseas subsidiaries in selected countries, FY2001-2002

Source: FY2001, compiled from Japan METI, “The Bahovior of Overseas Subsidiaries”, June 2002 p. 39 of “Report” and p. 2 of “Statistics”. FY 2002 compiled from Japan METI, “Trends in Oversea: Subsidiaries”, September 30, 2003, p. 42 of “Report” and p. 1 “Statistics”. Available online a http://www.meti.go.jp/statistics/index.html. Market-driven regional integration in East Asia

Share of exporter in total imports of trading partner (percent)

Trade balance of exporter (US$ million)

Trade balance as a percent of exports (percent)

Source: European Communities (2000). * These two treaties (EEC and EURATOM) constitute the Treaties of Rome.

Table A.2: Decision-making in the European Union Source: Compiled from European Communities (2003, pp. 6-11).

Instruments currently under consultation or negotiation (all bilateral except as noted) Source: Sakakibara and Yamakawa (2004, table 3.9, p. 96), compiled from UNCTAD (2003, annex table A.I.13) and other sources.Note: All agreements are adopted and binding, except those of APEC which are nonbinding.

Table 1: Intra- and inter-regional merchandise trade, 2002 (billion dollars and percentage)

Sources: Direction of Trade Statistics, IMF, 2004; National Statistics of Taiwan, Directorate General o Budget, Accounting and Statistics, Executive Yuan. Note: EA = East Asia includes ASEAN-10 (Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmat Philippines, Singapore, Thailand and Vietnam), plus China (Mainland and Macao), Hong Kong, Japar Korea, Taiwan, Australia and New Zealand.

Sources: Direction of Trade Statistics, IMF, 2004; National Statistics of Taiwan, Directorate General of Budget, Accounting and Statistics, Executive Yuan. Note: EA = East Asia includes ASEAN-10 (Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, Philippines, Singapore, Thailand and Vietnam), plus China (Mainland and Macao), Hong Kong, Japan, Korea, Taiwan, Australia and New Zealand. Table 3: Exports to East Asia as percentage of total exports, 1980-2003

Sources: Direction of Trade Statistics, IMF, 2004; National Statistics of Taiwan, Directorate General of Budget, Accounting and Statistics, Executive Yuan; World Economic Outlook database, IMF. Note: EA = East Asia includes ASEAN-10 (Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, Philippines, Singapore, Thailand and Vietnam), plus China (Mainland and Macao), Hong Kong, Japan, Korea, Taiwan, Australia and New Zealand. Table 4: Exports to East Asia as percentage of GDP, 1980-2003

Table 1: Dynamics of the Korea-China-Japan-ASEAN intra-trade intensity index

Figure 1 is a schematic drawing of this prediction for East Asian FTAs. While it does not show all the FTAs (e.g. Singapore has signed many bilateral FTAs), it stylised the implications of rampant bilateralism. Since ASEAN is not an effective free trade area, it is shown as a dashed and irregular shaped line. Figure 1: A possible FTA pattern: East Asian bicycle