Asian Regionalism? ASEAN Northeast Asia

Outline Economic development –Flying geese, falling geese Economic interdependence ASEAN Northeast Asia

Postwar Development I Flying geese pattern of economic development, by industry

Postwar Development II Flying geese pattern of economic development, by region

Trade Interdependence

ASEAN: overview Association of Southeast Asian Nations 10 member states –Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, Philippines, Singapore, Thailand, & Vietnam home to 600 million people collective GDP of US$2 trillion

ASEAN: founding (1967) 5 founding members: –Thailand, Malaysia, Singapore, Indonesia, Philippines Bangkok Declaration of 1967: –accelerate economic growth –promote regional peace and stability –contain the spread of communism

Arc of Containment

End of Cold War ASEAN Free Trade Area initiated at ASEAN summit in 1992 comprehensive program of regional tariff reduction program later broadened and accelerated reaffirmed during Asian Financial Crisis of

End of Cold War Expansion of ASEAN 1995: Vietnam 1997: Laos 1997: Myanmar 1999: Cambodia

ASEAN: external links A joint forum with Japan was established in 1977 A cooperation agreement with the European Community was signed in 1980 ``ASEAN + 3”: regular series of meetings at the cabinet and head-of-government levels with Japan, China, and South Korea since 1997

ASEAN and U.S. Investment: –U.S. direct investment of US$157 billion in ASEAN –nearly 3 times more than in China –10 times more than in India Trade: –4rd largest export market ($76 billion) for U.S. –U.S. imported $123 billion from ASEAN

Northeast Asia Japan, South Korea, North Korea Mainland China, Hong Kong, Taiwan Mongolia, Russia

Northeast Asia Compared with Southeast Asia and West Europe, Northeast Asia has lagged behind –in developing mechanisms or institutions –of coordination, cooperation, or integration especially considering the immense economic potentials in the region –natural resources –human infrastructure

Political Difficulties Legacies of World War II –Japanese atrocities in Pacific Asia Legacies of Cold War –partition of Korea

Political difficulties Territorial disputes between –Japan and China –Japan and South Korea –Japan and Russia –“Sea of Japan” or “East Sea”? mutually reinforcing suspicions

Current Status Washington-Tokyo-Beijing triangle –PRC & Japan regard relationship with each other as 2nd in importance to that with US Japan plays significant role in integrating PRC into world economy Japan has a vital interest in PRC’s development and stability Economic interdependence

PRC’s Trade Partners 2012 Japan is mainland China’s third largest trade partner and largest import source Total trade volume: US$329 billion Total imports from Japan: US$178 billion –10% of mainland China’s total imports Total exports to Japan: US$152 billion –7% of mainland China’s total exports

Japan’s Trade Partners Mainland China is Japan’s largest trade partner, largest source of imports, and largest destination of exports –US$334 billion trade in 2012 –compared with $217 billion trade with US PRC (including Hong Kong) became Japan’s largest trade partner in 2004 –surpassed the US for the first time

Japan’s Direct Investment Largest overseas investment source 22,307 Japan-invested enterprises Directly or indirectly employ over 10 million people