The Asian 'Noodle Bowl': Is it Serious for Business

A lively debate is taking place over the impact of free trade agreements (FTAs) on East Asia's business between those who view the agreements as a harmful Asian noodle bowl - i.e., overlapping regional trade agreements - of trade deals and others who see net beneficial effects in terms of regional liberalization and a building block to multilateral liberalization. A lack of enterprise-level data has made it difficult to resolve the debate. Providing new evidence from surveys of 609 East Asian firms (in Japan, Singapore, Republic of Korea [hereafter Korea], Thailand, and Philippines), this paper seeks to address the critical question of whether the Asian noodle bowl of multiple overlapping FTAs is harmful to business activity, particularly for small- and medium-sized enterprises (SMEs). The surveys suggest that the Asian noodle bowl does not seem to have severely harmed the region's business activity to date. Use of FTA preferences is higher than expected from previous studies (22% of responding firms). Furthermore, only 27% of responding firms said that multiple rules of origin significantly added to business cost. However, as more currently under negotiation FTAs take effect and the complexity of the Asian noodle bowl increases, the business impact is likely to intensify. Implementation of key policies and closer publicprivate sector cooperation can help mitigate negative effects and facilitate a more SMEinclusive business response to FTAs. Suggestions include: encouraging most favored nation (MFN) liberalization, rationalization of rules of origin, upgrading origin administration, increased awareness of FTA provisions, improving business participation in FTA consultations, and SME support

Constructing and Multilateralizing the Regional Comprehensive Economic Partnership: An Asian Perspective

In May 2013 the ASEAN+6 countries began to negotiate the Regional Comprehensive Economic Partnership (RCEP). The objective of this paper is to analyze the feasibility of constructing such a region-wide agreement and to examine ways to multilateralize it. The paper first reviews free trade agreement (FTA) developments, and discusses the characteristics and motives of FTAs in East Asia. It then analyzes the contents of major plurilateral FTAs in East Asia, that is ASEAN's five FTAs each with the People's Republic of China, Japan, the Republic of Korea, India, and Australia/New Zealand, which are considered as a base for a region-wide FTA. Finally, the paper examines the feasibility of the RCEP by consolidating the ASEAN+1 FTAs and discusses the possible ways to multilateralize the RCEP

A MACROECONOMIC PERSPECTIVE OF AFTA'S PROBLEMS AND PROSPECTS

The Association of Southeast Asian Nations (ASEAN) and the impressive economic performance of most of its members have increased the weight of the region's views in world fora. However, ASEAN has been unsuccessful in fostering a regional integration arrangement (RIA) leading to an increase in intraregional trade and foreign direct investment. In January 1992, ASEAN launched the Asean Free Trade Area (AFTA) seeking to establish a free trade area (FTA) by 2008. Copyright 1995 Western Economic Association International.