The proliferation of free trade agreements (FTAs) is an important trend in recent Asia Pacific economic development. Two volumes published by World Scientific, Yunling Zhang's China and Asian Regionalism and Christopher Findlay and Urata Shujiro's Free Trade Agreements in the Asia Pacific, are comprehensive studies reflecting this trend. The two studies explore the main causes, characteristics, and impacts of FTA bilateralism in the Asia Pacific region, as well as the impacts on the global economy.
Zhang's fifteen-chapter volume reviews the emergence and development of Asian regionalism, which in his view promotes the region's cooperation and integration, and discusses China's role in Asian regionalism. It involves major policy research on the process of Asian cooperation. It provides valuable information for understanding and studying the ongoing process of regional cooperation in the region.
China and Asian Regionalism opens with an introduction to the characteristics of the East Asian cooperation and differentiates them, such as “functional institution-building,” from those of the European Union (EU) integration model, such as superregional power. The next three chapters continue presenting from a theoretical and conceptual perspective. The author reviews the emerging East Asian regionalism, projects the East Asian community building, and explores the direction and model of future regional cooperation.
Subsequent chapters focus on discussing the Northeast Asian Community, including China, Japan, and Korea, and the development of an East Asian FTA. Chapter 7 offers an overview of China's FTA strategy, and chapter 8 discusses the rationale and feasibility of designing an East Asian FTA. The next three chapters analyze monetary and financial cooperation in East Asia and the impact of the Asian financial crisis on the regional cooperation and on environmental and energy cooperation in the region. Chapters 12–14 investigate the development of China's regional cooperation with East Asia as a result of its economic emergence and the impact of its accession to the World Trade Organization and the impact of a China–ASEAN (Association of Southeast Asian Nations) FTA. The last chapter compares China's and Japan's partnerships with ASEAN.
While Zhang's volume focuses on East Asian regionalism from a markedly Chinese perspective, Findlay and Shujiro's eight-chapter volume, a collection of papers originally written for the Research Institute for Economy, Trade and Industry in Tokyo, presents a notably Japanese perspective. It provides an up-to-date assessment of and insights into FTAs in a broader Asia Pacific region and their impact on the region and beyond.
The volume opens with a discussion of the rules of origin, agricultural trade liberalization, and services in major FTAs. Chapter 3 analyzes the restrictions on foreign direct investment in FTAs. Chapter 4 compares the safeguard mechanisms of FTAs. Chapter 5 uses a computable general equilibrium model approach to assess FTAs' economic impacts. Chapter 6 evaluates the impacts of FTAs on trade flows using the gravity model approach. Chapter 7 examines the use of FTAs by Japanese firms. The final chapter presents a preliminary post evaluation of the impacts of Japanese FTAs and economic partnership agreements.
Both volumes emphasize the marked difference between the bilateral and mini-lateral nature of East Asian FTAs and the regionwide characteristics of EU and North American FTAs. The two volumes complement each other through their distinctly different foci and conceptual and theoretical perspectives on the relationship between economic bilateralism and regionalism. Both books agree that China began to actively initiate regional trade arrangement after its accession to the World Trade Organization, and succeeded in concluding FTAs with a number of regional economies.
By comparing Asia Pacific economic cooperation with the EU economic integration, the authors of both studies demonstrate their profound understanding of and balanced, analytical insight into the relationship of Asia Pacific economic cooperation and globalization.
Both volumes generally offer balanced viewpoints. The discussions of issues and policy suggestions are furnished with well-done figures, tables, and data analysis. Each chapter has notes with references of used materials. The reference data indicate the breadth and depth of the studies, which can guide the interested reader to more detailed readings for further research.
The meticulous comparative research and the authors' scholarly analytical quality provide eye-opening insights into the complexities of development of Asia Pacific FTAs. On the one hand, the authors consider the proliferation of FTAs a positive development in Asia Pacific. On the other hand, they consider FTAs' challenges and negative impacts on some sectors in this region.
The two volumes differ in their views on a number of issues. Zhang's book emphasizes that three major economies—the United States, EU, and Japan—have not expressed their interest in an FTA with China yet because these economies do not accept the country's request for market economy status, and they have continuing concerns about agricultural liberalization with China. In contrast, Findlay and Shujiro's volume argues that Japan's proposal at the ASEAN + 3 economic ministers' meeting in 2006 for a Comprehensive Economic Partnership in East Asia, which covers ASEAN plus China, Korea, and Japan, plus India, Australia, and New Zealand, gave Japan a leadership role in Asia Pacific regional cooperation.
Zhang's volume could be further improved in several aspects. First, a more critical perspective could be provided to deal with the challenges that Asian economies face and the negative impacts of FTAs on certain sectors of Asian economies, and the author could have considered possible solutions for Asian economies to deal with those challenges and negative impacts. Second, although it was published in 2010, some of the data used in the study need updating. For example, there is a chapter (chapter 10) exploring the relationship between the Asian financial crisis in 1997 and the Asian regional cooperation. However, there is a need to deal with the relationship between the more recent U.S. and global financial crisis and Asian regional cooperation. Indeed, this study could increase its value significantly if more recent issues were explored, such as how the Asian economies tackled financial crisis through regional cooperation.
In addition, analysis of several aspects, such as China's urbanization, its rise from poverty into a low-middle income economy, and its transforming economic development model, could have been added to chapter 12 on the trend of China's economic emergence and regional cooperation. After all, the 15 million to 20 million migrants moving from rural areas to cities in China every year represent not only a significant portion of the Chinese population's rise from poverty, but also help transform China's export-oriented economic model to a consumer-oriented one.
Both volumes are commendable in several aspects. First, they represent the latest strand of research on this issue. Second, in contrast to other studies, these volumes present a comprehensive treatment of economic integration in the Asia Pacific. The arguments are supported by solid data analysis and documentation, which makes the views presented in these volumes authoritative and convincing.
These books are highly recommended to graduate students and researchers interested in international trade and Asia Pacific cooperation, as well as trade policy negotiators, policy analysts, and business strategy developers interested in Asia Pacific markets.
