The Evolution and Implications of Bilateral Trade Agreements in the Asia-Pacific

Vinod K. Aggarwal and Min Gyo Koo

Bilateral Trade Arrangements in the Asia-Pacific, 2006

The Asia-Pacific region has witnessed a dramatic rise of bilateral free trade agreements (FTAs) at the beginning of the 21st century. This shift away from the previous focus on the World Trade Organization (WTO) and the Asia-Pacific Economic Cooperation (APEC) forum could have potentially dramatic effects on trading patterns of countries in the trans-Pacific region. This book has considered the evolution of such bilateral trade agreements with an eye to understanding their origins, possible proliferation and expansion, as well as their impact on broad-based multilateral trade accords.

The main purpose of this chapter is to extract lessons from the empirical analyses of the political and economic factors that have driven Asia-Pacific bilateralism. Section II briefly reviews the theoretical arguments of Chapter 1, focusing on the explanatory approaches that guided the empirical analyses of this book. Section III considers the lessons emerging from Part II of the book, which provides the political-institutional and economic contexts for Asia-Pacific bilateralism. Then, Section IV reviews the nine country case studies. These include the “Big Three” of the U.S., Japan, and China, and the small and medium-sized “pace-setters” of South Korea, Singapore, Taiwan, Malaysia, Thailand, and Mexico. Section V then uses the empirical findings of country analyses to systematically evaluate the importance of political and economic factors in a comparative perspective. In conclusion, Section VI considers the likely implications of this new bilateralism for broader trading arrangements and avenues for further research.

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