人材育成成果

The idea of economic integration is spreading worldwide in recent years. Most of the countries in Asia, as a large source of capital of the world, are export-oriented which means their economies rely on trade. The accumulated capital cannot be efficiently used by production activities in the region. Thus, it is necessary to understand the relationship between trade and finance, their mechanism, in term of Asian framework.

To provide better understandings about financial integration in East Asia region which will lead to an increase in economic growth, by explaining the development of financial integration, comparing with trade integration, what are the determinants for East Asia financial flows and should in turn lead to the further discussion on steps of cooperation. The studies will be conducted to search for facts of financial integration in East Asia, and how to make the integration efficient.

This research intentionally purposes on the necessity of regional economic cooperation, focusing on why the accumulated capital in the region cannot be properly used in the region and how to make the flows more efficient.

There have been studies that showed the gap of level and growth between trade integration and financial integration in ASEAN+3, while studies mentioned that both integrations have positive effect on economic growth. It will be more appreciated if the two integrations have the same movement and support each other, in order to achieve the final target of economic growth. Finding relationship between each other will confirm that there is possibility of faster growth when the effects of these two integrations work together.

The program of the 8th EWC International Graduate Student Conference on Asia-Pacific Region was scheduled in 8 parallel sessions, 40 different topics. The keynote address made by Dr. Marcus Noland, Senior Fellow of Peterson Institute for International Economics and Non-Resident Senior Fellow of East-West Center on "Twilight of Globalization? A View from Asia Pacific". He pointed out that there have been changes in some aspect, namely investment climate, financial sector regulations, and shifting in influential power of international institutions from WTO, IMF to newly formed cooperation as G20. Asian regionalism is the key for Asian's role for further steps in global stage. However, instead of regional cooperation to gain more negotiation power, recent trend showed that Asian countries seem to make closer cooperation with US or other external countries. For the reason why he thought Asia was getting more powerful, it is because Asian countries have a lot of resources and within this region there are two large economies, China and Japan.

I have made my presentation in parallel session 4.4 on regional economic cooperation, which contained five presentations, namely, ASEAN Charter Debate: Between Rhetoric and Reality, my presentation on Economic Integration: Relationship between trade and financial integration in ASEAN+3, Outsourcing: Past, Present, and Future, The Future of Regional Economic Cooperation in South Asia, and Regional Trade Agreements and the Case for the South Pacific Regional Trade and Economic Cooperation Agreement (SPARTECA).

PRESENTATION
Economic Integration:Relationship between trade and financial integrations in ASEAN+3

Charosporn Chalermtiarana
Graduate School of Asia-Pacific studies
Waseda University
February 13, 2009
Financed by Global Institute for Asian Regional Integration (GIARI)
[421KB]

The discussion in this session was mainly about how far the economic cooperation has been taking in actions in 3 regions, South East Asia (including ASEAN+3 dialogue), South Asia, and South Pacific region. Most of the presenters focus on economic integration in two aspects, trade integration and political or institutional cooperation. There was also a debate about the necessity of economic cooperation, especially trade integration. Participants were convinced that trade integration and other economic cooperations are profitable for many regions, though there are still problems on taking steps on this issue. However, trade integration is not an absolute solution for every country and region in the world. Concerning a case study of South Pacific region, there are too difference in size of economies, legal rights of people between countries, and most important is trading patterns amongst regional countries. There was also an issue that pointed out that during the attempt to promote economic cooperation in regions, is there any benefit in improving individual's quality of living and economic development?

The questions that directly to my presentation were concerning more about the background of integrations and the movement of trade and financial flows. It seems that the idea of economic cooperation is not clearly understood by many people. Most of them concerned this issue as trade integration, an increasing of trade flows amongst region countries, while very little acknowledgement on other integrations, such as financial integration and institutional cooperation.

I also attended other presentations on several topics. One of them was investment issues in Asia Pacific, focusing on stock markets investments in countries such as Vietnam, Japan, USA, and another type of investment on health over the life cycle. In Vietnam, the presenter investigated foreign investors' behavior during the global financial crisis in early October 2008. He found that foreign investors started to sell a lot of securities in order balance exchange rate hedging for export and a tendency to shift their investment from equities to bonds. While in the case of Japan, the presenter studied about investor relations and cost of equity capital in Tokyo Stock Exchange market. The result showed that investor relations disclosure and information asymmetry component of cost of capital, such relative bid-ask spread and share turnover, reduces a firm's cost of capital. The presentation on "Why do older people quit stock market?" which investigated on US stock market participation rate over life cycle decreases as people get older. One reason can be explain by the correlation between stock return and uncertain health expenditure. The last presentation in this session was on "Health investment over the life cycle", which developed general equilibrium model to study the optimal health investment behavior over the life cycle.

Another interesting topic that I have attended was about bilateral trade relations. The presentation on "Challenges and solutions in improving supply chain of textile and apparel industry in China-A case study from Guangdong province", used Supply Chain Operations Reference (SCOR) model to analyze supply chain mode and the reasons of high logistic cost. It also suggested that by using supply chain integration pattern that was successfully improved textile industrial cluster in Italy, such as changing the role of company form OEM to initiate its own brand, may be able to upgrade the industry. Other presentation on "Problem defining the US consumer product safety improvement Act: Perception of Chinese manufacturing as a cause" focused on finding the major factor leading to certain policies within the act.

The experience of participating in this conference gave me an opportunity to present and discuss about my research issue. It is interesting to know how people from outside the region think about Asia under regionalism and cooperation frameworks. Also, the idea of regional integration seems to spread across the world which raising some concerns on its necessity and tailor-made blueprint for each region.