| Budget Amount *help |
¥1,100,000 (Direct Cost: ¥1,100,000)
Fiscal Year 2005: ¥500,000 (Direct Cost: ¥500,000)
Fiscal Year 2004: ¥600,000 (Direct Cost: ¥600,000)
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| Research Abstract |
In the past decade the number of free trade agreements (FTAs) has proliferated rapidly. Whether FTAs are a facilitating intermediate step towards global free trade or a hindrance to greater global trade liberalization is a hotly debated issue. In this project, the effects of prospective free trade agreements involving East Asian countries are assessed using a dynamic global computable general equilibrium (CGE) model. Our major findings are as follows :
1.In all FTA scenarios in East Asia that are considered in this project, welfare gains to the region are relatively small compared with global trade liberalization. Our findings indicate that the China-Japan-Korea FTA and the ASEAN+3 FTA would bring about relatively large welfare gains to all member countries.
2.In terms of economic welfare, East Asian countries have an incentive to sign an FTA with China largely because of its rapid growth in import demand.
3.When sensitive products such as food and agricultural products are excluded from the FTA involving Japan, welfare gains to the member countries would be reduced by 50-75 percent.
4.The indices of revealed comparative advantage (RCA) are computed and RCA rankings of commodities with various FTA scenarios and those with the global trade liberalization are correlated to examine how "natural" each grouping would be. The ASEAN+3 FTA, with relatively large welfare gains and small structural adjustments, could be a facilitating intermediate step towards global free trade. The smaller FTAs, such as the ASEAN-China, ASEAN-Japan and ASEAN-Korea FTAs, would result in large structural adjustments for ASEAN countries.
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