||Is Pan-Asian Economic Integration Moving Forward?: Evidence from Pan-Asian Trade Statistics
Sapkota, Jeet BahadurShuto, Motoko
57 , 2016-03 , Master's Program in International Area Studies, Graduate School of Humanities and Social Sciences, University of Tsukuba , 筑波大学人文社会科学研究科国際地域研究専攻
Asia is growing economically faster than any other region in the world; this led to the shift of the center of gravity of the global economy from the West to the East. However, it is not clear whether the Asian economy is integrating regionally or globally. In the context of the growing efforts of regional or sub-regional pan-Asian integration, it is worthwhile to explore the pan-Asian trade flows regionally as well as globally. Thus, this paper examines the trend and determinants of economic integration in pan-Asia, and its sub-regions in terms of the trade intensity index (TII) and the intra-regional trade share. The Asian Regional Integration Center (ARIC) of the Asian Development Bank (ADB) database revealed that, despite a rapid increase in the intra-Asian trade volume of all countries from 1990 to 2012, the trends of the intra-regional trade share of different countries are different, which indicates that countries in the region function independently, and stronger economic ties have not yet developed within pan-Asia and its sub-regions. Furthermore, the dynamic panel data analysis shows that free trade agreements or regional trade agreements (FTAs/ RTAs) are the main determinants of the growing intra-Asian trade proportion. Other determinants are countries' level of economic development, foreign direct investment (FDI) stock, urban population growth and access to information and communication technology (ICT). Thus, we argue that active participation in FTAs/RTAs, an open FDI policy, urbanization and the technological development of Asian countries create an enabling environment for pan-Asian economic integration.