Asian economic integration and cooperation: Challenges and ways forward for pan-Asian regionalism

As the Asian economies have grown larger and become more complex, they have also become more integrated at both the regional and the subregional level. Yet although economic integration has increased, regionalism in the sense of economic cooperation at both the panAsian and subregional levels has lagged behind. Regionalism or economic cooperation in terms of bilateral or multilateral FTAs is a relatively new phenomenon, but one that has increased rapidly in recent years. However, the progress of Asian regionalism faces several challenges. Also, the increasing number of FTAs could lead to a “spaghetti-bowl effect” and reduce trade volume instead of increasing it. In addition to resolving the existing challenges, actors in the region need to convert some of the existing FTAs into a broader one that can serve as a hub for further integration. Given the potential economic gains and future economic dynamism of the region, this paper suggests the pursuit of the Comprehensive Economic Partnership in East Asia (CEPEA) rather than the East Asia Free Trade Area (EAFTA).