Agriculture Reference
In-Depth Information
Recent studes have shown that economc ntegraton between Chna
and ASEAN wll brng numerous opportuntes as well as challenges for the
partcpants. Some studes show that Chna and ASEAN wll experence
net trade gains from the ACFTA and that it will promote economic growth
n both economes (Chrathvat 2002; ASEAN Jont Experts Group 2001).
In contrast, some studies find that China and ASEAN will be more likely
to compete with, rather than complement, each other (Tongzon 2005;
Holst and Weiss 2004; Voon and Yue 2003; Wong and Chan 2002). As the
ACFTA will likely increase the competitive pressures on ASEAN producers
in third-country markets and in ASEAN domestic markets, some special and
dfferental treatment has been seen as necessary for the poorer ASEAN
economies (Wattanapruttipaisan 2003). Studies have, however, pointed out
that China's market liberalisation under the ACFTA would provide ASEAN
countries with promising economic opportunities (Tongzon 2005; Holst
and Weiss 2004). Moreover, both economies would gain large benefits from
becomng more compettve and attractng foregn nvestment nto ther
integrated market in the long run (Wong and Chan 2003).
These dfferent vews certanly rase ssues worthy of further study.
Moreover, many empirical studies have shown that regional free trade
agreements contrbute to member countres' growth through the
accumulation of physical and human capital, productivity growth and
accelerated domestic reforms (for example, Ethier 2000; Fukase and Winters
2003), but that it cannot be assumed that all participants and sectors
will benefit equally. Some could, in fact, be hurt by the liberalisation.
Moreover, the realisation of the ACFTA is a complex procedure involving
several steps. It is useful, therefore, to study the effects under different
polcy arrangements durng the dfferent stages. There has been no study
focusing on the dynamics of the agreement. Therefore, one of the main
aims of this chapter is to explore the different economic effects of the EHP
during 2004-06 and the full implementation of the ACFTA in 2010.
Trade liberalisation in China and ASEAN
Because the major issue in a free trade agreement is tariff reduction, accurate
estmaton of the tarffs used by the partcpants s very mportant. In ths
