Costs and Benefits of Economic Integration in Asia

The global financial crisis of 2008/09 raised concerns that the world would move toward protectionism and isolationism. One fear was that tariffs and other barriers to international trade would increase, thereby reducing exports and imports of goods and services. Also restrictions on international financial flows might grow, thereby lowering cross-border asset holdings and amounts of foreign direct investment. Increases in trade and financial protectionism clearly pose threats to Asian economies, which rely heavily on external demand as an impetus to growth and are closely linked to global financial markets. To study these and related issues, this volume brings together eight chapters that deal with time patterns in trade barriers, volumes of trade, cross-border asset holdings and flows, foreign direct investment, currency regimes, and production structures between countries. The chapters emphasize developments in Asia since the early 1990s, but parts of the analysis relate to longer-term Asian history. The inclusion of the 1997/98 Asian financial crisis is particularly advantageous, although it was more localized than the 2008/09 crisis, the reactions observed within Asia in the late 1990s provide useful information about likely responses in Asia and elsewhere to the 2008/09 event.