ABSTRACT
This chapter examines the impact of the existing regional free trade areas (FTAs) on trade flows in East Asia. It investigates the mutual effects of concurrent regional FTAs to deduce the implications for a region-wide FTA. The chapter reviews the ex post studies on the impact of regional FTAs on trade in goods in East Asia. It focuses on empirical analyses of the tariff reductions of FTAs on trade in goods. The chapter presents studies related to association of southeast Asian nations (ASEAN) free trade areas (AFTA), ASEAN FTAs, and bilateral FTAs in East Asia. The key objective of the AFTA is trade liberalisation under the Common Effective Preferential Tariff scheme, which has been in effect since January 1993, to eliminate tariffs on intra-ASEAN trade. The chapter conducts an empirical analysis on the impact of ASEAN FTAs on trade in goods by using a gravity model. It summarises the results and draws policy implications.
