Analyzing the effects of the Regional Comprehensive Economic Partnership on FDI in a CGE framework with firm heterogeneity

2017 ◽  
Vol 67 ◽  
pp. 409-420 ◽  
Author(s):  
Qiaomin Li ◽  
Robert Scollay ◽  
John Gilbert
Keyword(s):  
Firm Heterogeneity ◽  
Economic Partnership ◽  
Regional Comprehensive Economic Partnership

The trade and income effects of RCEP: implications for China and Korea

2018 ◽  
Vol 22 (3) ◽  
pp. 306-318 ◽  
Author(s):  
Qiaomin Li ◽  
Hee Cheol Moon
Keyword(s):  
Computable General Equilibrium ◽  
Design Methodology ◽  
Firm Heterogeneity ◽  
Cge Model ◽  
Domestic Investment ◽  
Content Type ◽  
Income Effects ◽  
Economic Partnership ◽  
Regional Comprehensive Economic Partnership ◽  
Extensive Margin Of Trade

Purpose The purpose of this paper is to simulate the effects of the Regional Comprehensive Economic Partnership (RCEP) on trade and income, with a particular interest in the effect on China and Korea. Design/methodology/approach This paper adopts a Computable General Equilibrium (CGE) model developed by Li et al. (2017) to simulate the effect of RCEP. The CGE model is grounded in the firm heterogeneity theory. Within this framework, the feature of dynamic movements of firms allows the CGE model to capture the extensive margin of trade increase. Aside from that, the CGE model separates foreign direct investment (FDI) from domestic investment, which helps to explain the effect of the removal of FDI barriers. Findings Results show that RCEP will increase trade of China by 1.5 percent. The income of China will increase by 2.5 percent. The trade increase of Korea will be $8bn, and its income will increase by 0.6 percent. In terms of welfare, China will gain $214bn and Korea will gain $23~35bn, taking 2~3 percent of Korea’s GDP. Also, the reduction of behind-the-border barriers presents very significant effects. Originality/value The main contribution of this paper is to quantitatively assess the potential effects of RCEP on trade and income. The positive findings would propel RCEP parties, especially China and Korea, to reach an agreement as soon as possible.

Trade Creation or Trade Diversion in ASEAN and ASEAN+6 FTAs: Trade Indicators Approach

2015 ◽  
pp. 25-41
Author(s):  
Anh Tu Thuy ◽  
Ngoc Le Minh
Keyword(s):  
Comparative Advantage ◽  
Wheat Gluten ◽  
Free Trade Area ◽  
Private Investment ◽  
Trade Diversion ◽  
Trade Creation ◽  
Public And Private ◽  
Trade Area ◽  
Economic Partnership ◽  
Regional Comprehensive Economic Partnership

This paper makes use of two trade indicators, Revealed Comparative Advantage (RCA) and Regional Orientation (RO), to evaluate the economic impacts of the ASEAN Free Trade Area (The) and the Regional Comprehensive Economic Partnership (RCEP) on Vietnamese commodities at the Harmonized System (HS) 2-digit level. Several sectors in which Vietnam has revealed a comparative advantage, has benefited from the AFTA, and would continue to enjoy trade creation from the RCEP, are: Cereals (10), Salt, sulphur, earth, stone, plaster, lime and cement (25), Rubber (40), Knitted or crocheted fabric (60), etc. More importantly, the result provides a list of commodities in which Vietnam has a comparative advantage and only experiences trade creation when participating in the RCEP. These are: Milling products, malt, starches, inulin, wheat gluten (11), Vegetable plaiting materials, vegetable products not elsewhere specified (14), Wood and articles of wood, wood charcoal (44), etc. Findings also show commodities in which Vietnam has a comparative advantage; but are not well positioned in the RCEP market yet, e.g. Cereal, flour, starch, milk preparations and products (19) and Manmade staple fibres (55). If sufficient investment decisions and marketing strategies are applied to these commodities, they will well penetrate the RCEP market and bring trade creation and welfare improvement to Vietnam. Public and private investment should consider the above-mentioned commodities as targets to leapfrog the benefits of RCEP.

Respon ASEAN Terhadap Mundurnya India Dari Kerja Sama Regional Comprehensive Economic Partnership (RCEP)

2020 ◽  
pp. 183-202
Author(s):  
Raden Maisa Yudono ◽  
Wiwiek Rukmi Dwi Astuti ◽  
M. Chairil Akbar Setiawan
Keyword(s):  
Comparative Advantage ◽  
Economic Cooperation ◽  
Point Of View ◽  
Geographic Proximity ◽  
Strategic Partner ◽  
Business Interests ◽  
Political Conditions ◽  
Economic Partnership ◽  
Regional Comprehensive Economic Partnership ◽  
Static Point

Regional Comprehensive Economic Partnership (RCEP) is a cooperation framework formulated by ASEAN and 6 strategic partner countries and is the first proposal in ASEAN history to discuss comprehensive economic cooperation. RCEP is ASEAN's effort to strengthen its position as regional aktor in the Southeast Asian. RCEP negotiations underwent changes during India's decision to withdraw from the RCEP negotiations, which prompted ASEAN to respond to these developments. This study fokuses on response taken by ASEAN to India's decision to withdraw from the RCEP negotiations. The concept used is soft regionalism which emphasizes geographic proximity, historical relations and the comparative advantage of the region. Soft regionalism is driven by not only by economic and business interests, but also market interests that become the energy of soft regionalism in Asia. This concept is functioning well because it conforms to the pragmatic Asian political conditions. The findings of this study is that ASEAN cannot be separated from the concept of soft regionalism in which it has been running, and still sees all changes through static point of view. ASEAN needs to make new breakthroughs in realizing comprehensive cooperation in the region.

scholarly journals Economic Implications of the Regional Comprehensive Economic Partnership for Asia and the Pacific

2021 ◽  
Author(s):  
Cyn-Young Park ◽  
Peter A. Petri ◽  
Michael G. Plummer
Keyword(s):  
Computable General Equilibrium ◽  
Computable General Equilibrium Model ◽  
Regional Trade ◽  
Economic Implications ◽  
The Pacific ◽  
Economic Partnership ◽  
Regional Comprehensive Economic Partnership ◽  
Factor Returns ◽  
Investment Patterns ◽  
Trade And Investment

The Regional Comprehensive Economic Partnership (RCEP) presents strong potential to mold regional trade and investment patterns well into the future and to influence the direction of global economic cooperation at a challenging time. This paper evaluates the RCEP’s impact on global and regional incomes, trade, economic structure, factor returns, and employment using a computable general equilibrium model. The results suggest that the RCEP agreement could generate sizable global income gains. Together with the Comprehensive and Progressive Agreement on Trans-Pacific Partnership, the RCEP will also strengthen the region’s manufacturing supply chains, raising productivity and increasing wages and employment.

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