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GTAP Resources: Resource Display

GTAP Resource #4098

"The production/distribution networks in East Asia and the Regional integration"
by Ando, Mitsuyo

This paper attempts to investigate the features of development and restructuring patterns of production/distribution networks in East Asia, mainly in machinery sectors, using international trade data at the most disaggregated level, to discuss their resilient nature, and to provide policy implications for the regional production networks as well as the region integration.

The production/distribution networks in East Asia have been rapidly developing since the 1990s. The Global Financial Crisis (GFC) in 2008 had huge and prolonged impacts on the world economy. Although the negative impacts were initially transmitted through the networks, the production networks in East Asia rather revealed their resilient nature. Intra-regional machinery trade has been enhanced and contributed as a source of quick recovery from the GFC, and the restructuring of regional production/distribution networks has been accelerated with the GFC as a trigger. Moreover, East Asia is strongly connected to the outside economies through production networks in addition to the countries in the region, with the strengthening competence for the production networks in East Asia, particularly in the electric machinery sector.

To further utilize the mechanics of production networks, it is essential to reduce costs of service links (SL) connecting production blocks (PBs) and to improve location advantage that may realize a cost reduction at each PB. For example, the reduction in tariffs and non-tariff measures (NTMs) and the implementation of various trade and investment facilitation measures should contribute to the reduction in SL costs. While East Asia’s integration has been the market-driven, rather than the rule-driven as is observed in Europe, free trade agreements (FTAs) now must be one of the tools for trade and investment liberalization and facilitation and cooperation, which help further development of regional production networks and integration.

Resource Details (Export Citation) GTAP Keywords
Category: 2013 Conference Paper
Status: Published
By/In: Presented at the 16th Annual Conference on Global Economic Analysis, Shanghai, China; Forthcoming in the ERIA report
Date: 2013
Created: Ando, M. (4/10/2013)
Updated: Batta, G. (4/15/2013)
Visits: 833
- Foreign direct investment
- Asia (East)
- Asia (Southeast)

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