A Two-Hub Trading Bloc in East Asia?

Chen, Lurong, "A Two-Hub Trading Bloc in East Asia?" in Corporate Strategies in the Age of Regional Integration ed. Kim, Jong-Kil and Ruffini, Pierre-Bruno (Northhampton: Edward Elgar Publishing Ltd., 2007), 200-218.

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  • Author Chen, Lurong
    Book Editor Kim, Jong-Kil
    Ruffini, Pierre-Bruno
    Chapter Title A Two-Hub Trading Bloc in East Asia?
    Book Title Corporate Strategies in the Age of Regional Integration
    Publication Date 2007
    Place of Publication Northhampton
    Publisher Edward Elgar Publishing Ltd.
    Start page 200
    End page 218
    Language eng
    Abstract Asian countries are said to be on their way towards regionalism in the last decade as EU was born in Europe and NAFTA came into being in North America. There are currently more than 30 FTAs under working on among Asian nations. The dazzling network of FTAs makes it worthwhile to outline the underlying structure of the on going trading bloc in East Asia and to evaluate the potential effects of different FTAs. In this paper we draw an outline of Asian regional trading bloc with the aid of the gravity model and the two indices – HM and BTL, based on which we find that Japan and China are the two individual hub candidates in the region. The former is for the long time the biggest economy in East Asia; while the latter’s influence keeps rising in last years. Even though neither of them has a de facto dominant position in the region from the aspect of international trade, we believe that they are the only two individuals that are qualified to become the hub in the region. More precisely, if there is a FTA that could really trigger the domino effect and drive other countries in the region to join the area; it should include at least one of these two hub candidates or even both of them. As for the question on the possible fundamental agreement of the regional integration, the most influential FTA might be the one that set up between China and the ten ASEAN countries in late 2004. The HM measure also predicts that once China-ASEAN FTA is there, it will be very difficult for the other countries to keep apart from it. In order to avoid to fall in the “spoke trap”, they might choose either to join China-ASEAN FTA early or move fast to establish their own FTA(s).
    Copyright Holder The Author
    Copyright Year 2007
    Copyright type All rights reserved
    ISBN 9781847201416
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    Created: Fri, 15 Feb 2019, 11:45:47 JST