asian trade -devesh
Post on 16-Apr-2017
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Presented by Devesh PatidarASIAN Trades
ContentMajor trade blockPatterns of tradeRole and impact of FTAs & RTAsTrade in goods performanceTrade in services performanceRole of Foreign InvestmentPublic-private partnershipsImplications
Trade Blocks in AsiaASEANSAARCASIA Pacific
ASEAN (8 August 1967)
SAARC (December 8,1985 )
ASIA Pacific (1980)
1. Patterns of trade in Asia- Over 50% of trade by countries in the region is within the region- Chinas role as a major exporter and importer, as well as investor looms ever larger- When seen in terms of sub-regions, however, it is clear that within South Asia, intraregional trade is much more limited (6%). Indias major markets are now in East Asia
2. Role and impact of FTAs and RTAs
- Various questions were raised: does trade expand more as a result of trade agreements, or is their impact quite marginal in practice? Are they weak and light?
- Is there such a proliferation of the noodle bowl that trade becomes more complicated and may as well revert to MFN principles?
- Do trade agreement pose a threat to, or do they reinforce WTO agreements?
- Could some of them eventually be ruled as illegal by WTO rules (which are currently couched in very vague terms).- Is the way forward to strengthen an enhanced East Asian trade market on one hand, an enhanced SAARC on the other and build bridges between them.- Or is the best way forward to build the East Asian summit (EAS) initiative encompassing 50% of the worlds population and comprising potentially the largest economic bloc in the world.
3. Trade in goods performance
- Degree of liberalization is critical. With some exceptions, East & Southeast Asia is more liberalized than South Asia. Some slowdown, but China racing ahead .- Huge contrast between China and India in respect of ease of trading across borders (38th and 139th in world ranking). Do more liberal economies lead to greater domestic inequalities?
Other factors concern cross-border trade facilitation, which is much more inhibited within South Asia. Examples include transport restrictions, product standards, arbitrary costs (speed payments)- In South Asia, India is very dominant. In East Asia, China is very dominant. However political relations in South Asia inhibit more trade cooperation
4. Trade in services performance
Services trade is dependent on the state of economic development of countries
Services trade is, hither to, market driven with little contribution by regional or multilateral trade agreements
Transparency and appropriate regulatory regimes has more impact on promoting services trade than pure market access commitments
- Sequencing of service liberalization, bilateral versus multilateral liberalization are other issues which merit attention
5. Role of Foreign Investment
- Partly as a result of more defensive investment regimes and less integrated regional markets, FDI into South Asia has been at much lower levels than in East and Southeast Asia
- Outward investments - particularly in India and Pakistan - are controlled
Without further liberalization of investment, South Asia will not benefit from industrial restructuring and more trade
- Patterns of investment in East and Southeast Asia take a more regional perspective, helping to develop region wide value chains (e.g. car manufacturing)
A constructive relationship between Governments and private sector is indispensable for successful exporting
- In East and Southeast Asia the relationship appears to be more constructive than in South Asia, where the private sector identifies some Government regulations as obstructive to trade6. Public-private partnerships
- More trade facilitation (standards, documentation, rules, connectivity, etc.) and more predictability
Joint development of infrastructure and power
Freer movement of people across borders
More cooperation among business chambersImplications
Closer collaboration and better understanding between business and Government e.g. via trade support institutionsMore liberalization and state regulation in both trade and investment- Key role for Elder Brother India to play constructive role, both through SAARC and regionally