East Asia’s Economic Integration: Progress and Benefit by Daisuke Hiratsuka, Fukunari Kimura (eds.)

By Daisuke Hiratsuka, Fukunari Kimura (eds.)

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San Miguel, a major brewery in the Philippines, has expanded its business overseas. San Miguel operates breweries in Vietnam, Australia and Indonesia and maintains four breweries in China, including in Hong Kong. The Charoen Pokphand (CP) Group, a leading Thai agro-based company, has expanded into Bangladesh, Cambodia, China, Hong Kong, India, Indonesia, Malaysia, Myanmar, Singapore, Taiwan, Turkey and Vietnam. Thus there are many indigenous enterprises, as in the cases cited above, that have successfully made linkages with MNEs, and are expanding sales in the integrated ASEAN market.

18 Second, practical institutional building is incorporated, which includes investment rule, intellectual property rights protection, public procurement, and others. The Japanese are not good at the legal, rulemaking approach. Their approach is more pragmatic and emphasizes the improvement of the business environment in the context of production/distribution networks. There is also an emphasis on capacity building with economic/technical cooperation and the enhancement of stability and accountability of the policy environment.

Does the business sector use the preferential tariff scheme? In order to avoid tariff fraud, whereby goods from third nations are transported through a member country to gain preferential access, FTA requires the importer to prove that the goods actually originated in the member countries. This requirement raises the question of whether FTA is effective in East Asia. 18 East Asia’s Economic Integration In Chapter 4, ‘Rules of Origin, Local Content, and Cumulative Local Content in East Asia: Application of an International Input–Output Analysis’, Ikuo Kuroiwa conducts an empirical study, based on the Asian international input–output tables developed by the Institute of Developing Economies, to address this very question.

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