Beyond Market Access?: The Anatomy of Asean's Preferential Trade Agreements

David Kleimann 

European University Institute
February 2013

EUI Working Papers LAW No. 2013/01 
Abstract:      
This study seeks to enhance the understanding of ASEAN’s external preferential trade agreements (PTA) in context of the recent growth of economic regionalism in East Asia. First, the paper compares the content of ASEAN’s five plurilateral PTAs with China, Korea, Japan, India, Australia, and New Zealand with the status quo of ASEAN’s internal economic integration. In a second step, the paper compares ASEAN’s plurilateral agreements and ASEAN’s internal integration with the content of six bilateral PTAs that individual ASEAN member states have concluded with Japan. The empirical findings demonstrate that the ambition of ASEAN’s five plurilateral agreements finds its upper limits in the substantive content of ASEAN’s internal economic integration. Within these limits, the coverage and depth of commitments varies considerably in correlation with the intensity of trade between ASEAN and the respective external partner. Moreover, the comparison shows that bilateral PTAs between six individual ASEAN member states and Japan go significantly beyond the status quo of ASEAN’s internal integration and exceed the coverage and depth of ASEAN’s external plurilateral PTAs. The author contends that the coverage and depth of ASEAN member states’ plurilateral PTAs is limited by the structural heterogeneity of the signatories and, as a result, a relatively high diversity of policy preferences. Bilateral PTAs between ASEAN member states and the same external partners result in deeper commitments than the plurilateral accords, because of both a higher common denominator among the parties to the agreements and the free-rider problem that persists in plurilateral negotiation settings. Moreover, it is argued that the coverage and depth of the agreements is a function of the intensity of trade among the parties: high trade intensity results in deeper and more comprehensive agreements that tackle 21st century trade issues, whereas low trade intensity results in shallow agreements that aim to reduce first-generation trade barriers. These hypotheses, which are fully verified by the empirical findings of this study, allow for important conclusions about the role of ASEAN member states - collectively and individually - in current and future economic integration initiatives such as ASEAN 6, the TPP, or EU-ASEAN PTA negotiations.

Number of Pages in PDF File: 63

Keywords: ASEAN, Japan, East Asia, Regional economic integration, Preferential trade agreement, Free trade agreement, Economic partnership, Plurilateral, bilateral, trade intensity, WTO

Full text available at: http://papers.ssrn.com/sol3/papers.cfm?abstract_id=2271989