Asia has undoubtedly benefited greatly from globalization, with many countries of the region relying to a significant extent on international trade and investment as their main engine for economic growth and development. As the economies of the region continue to grow at the fastest pace of any other regions in the world, however, some have begun to question how well the gains are shared within the countries themselves. Indeed, there is some evidence that higher economic growth has led to increases in inequality in the countries of the region.

Liberalization of the business environment as well as increased international integration in Viet Nam have resulted in the rapid expansion of small and medium-sized enterprises (SMEs) in general and export-oriented small and medium-sized manufacturing enterprises (SMMEs) in particular, especially since 2000. More than 95 per cent of formal enterprises belong to the SME category. Around 17 per cent of SMMEs are involved in export activities.

Economic integration in the European Union1 has, arguably, been one of the most significant developments in the global economy in the last half-century. How could countries that just a few decades earlier were at war and culturally disjointed now aim at closer economic and political integration, and appear en route to forming one virtual “country” under a proposed European Constitution? The formation of the European Union, the adoption of the single currency, and many other erstwhile targets that were deemed “too difficult”, but which are now realities, have proved many skeptics wrong.

Today, Nepal is one of the most liberalized countries in the South Asian region. However, growth performance has been very poor in recent years, with sluggish exports and stagnating investment. In this context, a closer examination of the linkages between trade and investment is critically important from a policy point of view. There are highly liberal trade- and investment-related policies supplemented by important Acts. In the aftermath of liberalization that began in the early 1990s, both trade and investment increased substantially. However, that could not be sustained for long...

This research paper intends to analyse: (a) the impacts of ASEAN trade liberalization on the macroeconomy variables – gross domestic product (GDP), Terms of Trade (ToT), balance of trade, inflation and real wage – and agricultural industries (output, exports and imports) in the ASEAN 6 countries (Indonesia, Malaysia, the Philippines, Thailand, Singapore, and Viet Nam); and (b) the impact of trade liberalization on income distribution in Indonesia. A multi-country and multi-commodity computable general equilibrium (CGE) GTAP model has been used as the main tool of analysis.

Developing countries in Asia have a large stake in maintaining an open global system of trade and investment. The integration of the region into the world economy has been driven largely by market forces, particularly by private foreign direct investment and the related rise of intra-industry trade.

The 147 member governments of WTO agreed on 1 August 2004 to commence negotiations on trade facilitation. This decision followed a heated and protracted debate on trade facilitation among WTO member countries that started after the Singapore Ministerial Meeting in 1996 and contributed, together with three other so-called “Singapore issues”, to the failure of the WTO Ministerial Meeting in Cancun in 2003.

Globalization and pressure from increased competition have led to “splintering” of in-house services from formerly integrated manufacturing firms in developed economies and, at the same time, to an increase in “outsourcing” of these same services. These two trends have caused a stronger linkage in services and manufacturing in economic data because services which were previously lumped with manufacturing are now recorded separately and, in a sense, given identity. The study tries to shed some light on this linkage in the Philippine case.

Bi-directional effects between international trade and investment are investigated. Different aspects of international trade are considered in separate models to observe the linkages between trade and FDI inflows. International trade, either measured by exports or imports, is found to be complementary with FDI inflows. Through trade, trade facilitation is identified as a key factor to induce FDI inflows to the host country from the home country.

Investment liberalization occupies an important place in the schemes of regional economic integration complementing trade liberalization to facilitate the process of restructuring of industry on more efficient lines. This restructuring enables fuller exploitation of the locational advantages or synergies between the member countries of the regional trading bloc besides facilitating businesses reaping the economies of scale and specialization.