The East Asian Noodle Bowl
Figure 1 makes the point graphically. The figure shows each FTA that has been
or is near to being signed. Specifically, by the end of 2005, the region had signed
what amounts to 57 FTAs. The ASEAN-PRC FTA (ACFTA) is counted as 10
separate deals due to ASEAN’s rather unique method of preferential
liberalization. The reality is extremely complex, but roughly speaking, PRC and each ASEAN country chooses its own “sensitive list” and bilateral market access
depends upon the interaction of the two lists. Nations do not get preferences for
items on their own list and are not granted preferences for items on the
counterparty’s list. All bilateral links inside the ASEAN FTA (AFTA) are listed separately for the same reason. The fractured nature of ASEAN’s basic approach
to preferential trade implies that the degree of market access faced by an AFTA
exporter of any particular product varies according to the ASEAN destination
market concerned. For example, we cannot view the Malaysia
Indonesia preferential tariff structure as identical, or even close to the Singapore
Philippines preferential tariff structure. Thus AFTA acts as if it were 45 bilateral trade relationships (10 times 9 divided by 2). Fortunately, the existence of ASEAN implies that 55 bilaterals are not completely dissimilar
ASEAN has imposed some discipline on rules of origin, product exclusion practices and phase in modalities. Finally, Japan has signed FTAs with Malaysia and Singapore with these beingde jure as well as de factoseparate a
greements. See Whalley and Banda (2005) for a detailed assessment of ASEAN’s trade deals.