Asian

REGIONALISM
 Name
That
Asian
Country
Name That Asian Country
Russia
Name That Asian Country
Name That Asian Country
Laos
Name That Asian Country
Name That Asian Country
Kyrgyzsta
n
Name That Asian Country
Name That Asian Country
Syria
Name That Asian Country
Name That Asian Country
Cambod
ia
 Asian
REGIONALISM
 Regionalism Vs. Globalization
REGIONALISM
The formal process of
intergovernmental collaboration
between two or more states.
It is also the expression of a common
sense of identity and purpose
combined with the creation and
implementation of institutions that
express a particular identity and
shape collective action within a
geographical region.
GLOBALIZATION
From previous studies, this refers to
the increasing global relationships
of culture, people and economic
activity. Most often as the global
distribution of the production of
goods and services, through the
reduction of barriers to international
trade such as tariffs, export fees and
import quotas.
REGIONALISM

Regionalism is the set of conscious activities carried

out by states within a region to cooperate

Regionalism is the formal process of intergovernmental

collaboration between two or more states
ASIAN REGIONALISM

THE PRODUCT OF ECONOMIC INTERACTION

NOT POLITICAL PLANNING, BUT A RESULT OF SUCCESSFUL,

OUTWARD ORIENTED GROWTH STRATEGIES

ASIAN ECONOMIES HAVE GROWN NOT ONLY RICHER, BUT

ALSO CLOSER TOGETHER
COUNTR IES OF ASIA
 NORTH ASIA

EAST ASIA

SOUTH ASIA

SOUTH-EAST ASIA

AUSTRILIA

NEW ZEALAND

ASIA-PACIFIC
Effects And Brief History Of Globalization To Asia

GLOBALIZATION
ASIA
-affects global economy, causes
market integration, imposes the
global interstate system and causes
global governance

What did RISE OF ASIA DUE TO

globalization GLOBALIZATION

do to asia? CULTURE IMPACTED BY REGIONALISM AN

GLOBALIZATION ALTERNATIVE
 WORLD WAR II

Culture Impacted
by Globalization
 Culture Impacted By Globalization
AFTER THE WORLD WAR: REBUILDING

SUHARTO REGIME –
INDONESIA

THAILAND – US
RELATION ON TRADE
 CULTURE IMPACTED BY GLOBALIZATION

ASIAN FINANCIAL CRISIS 1997

MEMBERSHIP TO WTO

LIBERATION OF ASIAN ECONOMY

 CULTURE IMPACTED BY GLOBALIZATION
EMPLOYMENT PRACTICES

NO LEGAL CONTRACTS
NO LEGAL CONTRACTS
LESS WAGE/SALARY
RATE OF UNEMPLOYMENT
POOR WORKING CONDITIONS
 CULTURE IMPACTED BY GLOBALIZATION
POLITICS
FALL OF DICTATORSHIP & RISE OF DEMOCRACY

OUSTING OF SUHARTO 1998 OUSTING OF MARCOS PH 1986

CULTURE IMPACTED BY GLOBALIZATION
CULTURE AND DIET

SOCIAL MEDIA

INTERNET

FAST FOOD
 RISE OF ASIA DUE TO GLOBALIZATION
PH OFW
ASEAN

JAPAN’S TECH

ANIME
RISE OF ASIAN INFLUENCE GLOBALLY

INDIA’S IT
CHINA’S WORK
FORCE

KOREAN WAVE
 REGIONALISM AS AN ALTERNATIVE

APPROACHES TO INTEGRATION

A) SUPRANATIONALISM

- states pool their sovereignty in a way that limits their autonomy in deciding over
issues, whether economic, military or political in nature.

B) INTERGOVERMENTALISM

- Integration based largely on the principle of non-interference or intervention in

domestic matters.
 REGIONALISM AS AN ALTERNATIVE

INTEGRATION AS PROTECTION AGAINST GLOBALIZATION

- Regional Integration or regionalism enables to confront the challenges of

Globalization.

- A single country can’t face the challenges of Globalization. For example the East
Asian Financial Crisis.
 REGIONALISM AS AN ALTERNATIVE
REGIONAL INTEGRATION IN ASIA
AND
EMERGENCE OF MIDDLE CLASS ASIA

APEC(FTAAP)
Canada, Chile, Hong Kong,
Mexico, Papua New Guinea,
Peru, Russia, Chinese Taipei,
U.S ASEAN+6
Australia, New Zealand
ASEAN+3 India

China, Japan,
Korea ASEAN
Brunei, Indonesia, Malaysia,
the Philippines, Vietnam, Cambodia,
Singapore, Thailand Laos,
Myanmar
 REGIONALISM AS AN ALTERNATIVE
REGIONAL INTEGRATION IN ASIA
AND
EMERGENCE OF MIDDLE CLASS ASIA

MEMBERS OF ASEAN
 REGIONALISM AS AN ALTERNATIVE
REGIONAL INTEGRATION IN ASIA
AND
EMERGENCE OF MIDDLE CLASS ASIA

ASEAN SYSTEM AND STRUCTURE

• Formed on August 8, 1967 in Bangkok, Thailand, with the
signing of the ASEAN Declaration (Bangkok Declaration)

• Founding Father of ASEAN

- Adam Malik (Indonesia)
- Narciso R. Ramos (Philippines)
- Tun Abdul Razak (Malaysia)
- S. Rajaratnam (Singapore)
- Thanst Khoman (Thailand)
 REGIONALISM AS AN ALTERNATIVE
ASEAN

VISION

The ASEAN Declaration states that the aims and purposes of the Association are:

(1) to accelerate the economic growth, social progress and cultural development in
the region through joint endeavors in the spirit of equality and partnership in order
to strengthen the foundation for a prosperous and peaceful community of Southeast
Asian nations.

(2) to promote regional peace and stability through abiding respect for justice and
the rule of law in the relationship among countries in the region and adherence to
the principles of the United Nations Charter.
 REGIONALISM AS AN ALTERNATIVE
ASEAN

1992 – ASEAN Free Trade Agreement

1997/98 – economic crisis – acceleration of economic integration initiatives – ASEAN
Vision 2020
2003 - Bali Concord II – the launch of ASEAN Community by 2020
2005 – the launch of ASEAN Charter process
2006/07 – the acceleration of ASEAN Community to 2015
2007 – ASEAN Charter drafting and the ASEAN Economic Community Blueprint
2008 – ASEAN Charter ratification
REGIONALISM AS AN ALTERNATIVE
ASEAN
ASIAN REGIONALISM

EXTERNALIST VIEW

GENERATIVE VIEW

THE REGION AS AN ALTERNATIVE TO

GLOBALIZATION
 REGIONALISM AS AN ALTERNATIVE
MIDDLE CLASS ASIA

2nd wave
1st wave
1960s – 1980s
1950s – 1970s
South Korea, Taiwan,
Japan
Hongkong, Singapore

3rd wave
4th Wave
1980s – 1990s
Urban Centers in
Thailand, Malaysia, China
Indonesia, Philippines
 REGIONALISM AS AN ALTERNATIVE
MIDDLE CLASS ASIA

This much is clear—the Asian middle class will play an

increasingly important role in the shift in the balance of global
demand and change over the next few decades. Its rise may
present many challenges, but it will also open up new and
unprecedented opportunities for the region and for the world.

(Asian Development Bank)

 • Flying in sequence
GROWTH AND • The crisis and its legacy
• Renaissance
INTEGRATION • Asia in 2020

THE RISE OF • Measuring interdependence

• How markets drive integration
REGIONALISM • How policy makers are responding

THE EMERGING • Production

• Financial Markets
REGIONAL • Macroeconomics
• Social and environmental issues
AGENDA • Cooperation
 The crisis
and its Renaissance
legacy

Flying in
Asia in 2020
sequence
GROWTH
AND
INTEGRATION
GROWTH AND
INTEGRATION
Asian regionalism is
emerging against the
backdrop of a remarkable
half century of economic
development.

GROWTH AND
INTEGRATION
GROWTH AND
INTEGRATION
In the four decades
from 1956 to 1996, East
Asian living standards—as
measured by real (inflation
adjusted) output per
person—rose at a rate
faster than has ever been
sustained anywhere else.
GROWTH AND
INTEGRATION
GROWTH AND
INTEGRATION
In the four decades from
1956 to 1996, East Asian living
standards—as measured by real
(inflation adjusted) output per
person—rose at a rate faster than
has ever been sustained
anywhere else.
GROWTH AND
INTEGRATION
FLYING IN
SEQUENCE Competition in
global markets is at the
heart of what is now
understood as the East
Asian development
model.

GROWTH AND
INTEGRATION
FLYING IN
SEQUENCE
When the model emerged
in the 1950s, its focus on
labor-intensive exports was
new; the prevailing “big
push” development strategy
favored large, coordinated in
a bid to achieve economies
of scale

GROWTH AND
INTEGRATION
FLYING IN
East
SEQUENCE Asian
development instead
relied on the region’s
abundant asset of
relatively well-educated,
low-wage labor and in
time leveraged it with
ample savings and
investment
GROWTH AND
INTEGRATION
 THE CRISIS AND ITS
THE CRISIS
LEGACY
AND ITS
LEGACY
In the Second World War, most of the
East Asian region was synonymous with
rapid, largely unexpected economic
development.

The 1997/98 financial crisis dealt a severe

setback, highlighting Asia’s impetus for
regional cooperation.

GROWTH AND
INTEGRATION
 THE CRISIS
THE CRISIS AND ITS
AND ITS
LEGACYLEGACY
-For much of the period following the Second
World War, most of the East Asian region was
synonymous with rapid, largely unexpected economic
development.
-The 1997/98 financial crisis dealt a severe setback
to much of the region, highlighting Asia’s shared interests
and common vulnerabilities and providing an impetus for
regional cooperation.

GROWTH AND
INTEGRATION
 THE CRISIS AND ITS
THE CRISIS
LEGACY AND ITS
LEGACY
‘Asian miracle’ spread from Northeast to
Southeast Asia suddenly disappeared
following the economic crisis that engulfed
the region in the late 1990s.

The crisis itself was consequently a

profoundly important event in the history of
the region.

GROWTH AND
INTEGRATION
 THE CRISIS AND ITS
THE CRISIS
LEGACY AND ITS
LEGACY
Indeed, when a second ‘global
financial crisis’ (GFC) hit the region in the
late 2000s, the region proved to be
comparatively immune to its impact and
it was seen as one of the few bright
spots and potential growth engines in
the global economy.
GROWTH AND
INTEGRATION
 THE CRISIS AND ITS
HOW ADVERSITY
LEGACY BECAME A
SILVERLINING
“The crisis”—put the region’s
interdependence into harsh new focus.

Emerging Asian economies that had

opened up their financial markets—Indonesia,
the Republic of Korea, Malaysia, the
Philippines, and Thailand—were worst hit, but
nearly all Asian economies were eventually
affected.
GROWTH AND
INTEGRATION
 THE CRISIS AND ITS
HOW ADVERSITY BECAME A
LEGACY

SILVERLINING
Most then used the crisis as an
opportunity to pursue wide-ranging reforms in
finance as well as in other areas of weakness
that the crisis exposed.

Asia emerged with a greater appreciation

of its shared interests and the value of regional
cooperation.

GROWTH AND
INTEGRATION
 THE CRISIS AND ITS
HOW ADVERSITY
LEGACY BECAME A
SILVERLINING

New mechanisms were formulated to

provide emergency resources for future crises,
and these initiatives were under the
stabilization programs negotiated with the
International Monetary Fund (IMF).

GROWTH AND
INTEGRATION
 THE CRISIS AND ITS
KEY LESSONS
LEGACY OF THE
CRISIS
1. Rapid development inevitably creates structural
tensions

2. Asian economies have deeper connections with

each other and a larger stake in their common
macroeconomic stability

GROWTH AND
INTEGRATION
 RENAISSAN
CE
Since the crisis, Asia has reemerged as the
world’s most dynamic region, experiencing
what a new World Bank study has called the
East Asian renaissance

GROWTH AND
INTEGRATION
 RENAISSAN
CE
The PRC, India, and Vietnam are
now the region’s—and the world’s—
fastest growing economies.

Growth in the directly affected

economies of the Association of
Southeast Asian Nations (ASEAN),
though disappointing compared to
GROWTH AND earlier periods, is also gradually
INTEGRATION strengthening
 RENAISSANCE
India’s acceleration, although
more recent, is also impressive.
With 1.1 billion people and rapid
population growth, India appears
set to be the world’s most
populous country within two
decades.
GROWTH AND
INTEGRATION
 RENAISSANCE
To compete with the PRC
and India, as well as the other
integrating economies of the EU,
NAFTA, and other regional
groups, the governments of
smaller Asian economies—
particularly in Southeast Asia—are
now intent on building larger
GROWTH AND
INTEGRATION economic zones with transparent
internal borders.
 RENAISSANCE
In announcing ASEAN’s
commitment to a single market,
senior officials explicitly noted the
need to make markets large
enough to compete with those of
the PRC and India (The Times of
India 2006).
GROWTH AND
INTEGRATION
 Asia's outlook ASIA
is bright,
IN 2020
because Asia is likely to continue
outperform over the next decade
with the long term projections and
India and PRC leading the way for
Asia. According to these
projections, Asia's share of world
output and income will expand
GROWTH AND
INTEGRATION from 28% in 2005 to 35% in 2020 in
purchasing power party (PPP)
terms.
 ASIA IN
By 2020, Asia's GDP (PPP 2020
-
terms) is set to be more than 60%
larger than the EU's and North
America's. These trends also
suggest that regional integration will
become increasingly important for
Asia’s growth.
GROWTH AND
INTEGRATION
 ASIA IN 2020

On the demand side, Asia will

benefit from its own expanding
spending power.

On the supply side, its

productivity will be enhanced by the
GROWTH AND
INTEGRATION advantages of its larger, more
integrated economy
 ASIA IN
2020
Asia’s economic scale will offer
exceptional opportunities for
efficient production.

Trade and financial activities are

of particular interest because these
GROWTH AND
INTEGRATION sectors usually expand faster than
output.
 ASIA IN 2020

Their continued development

will increase interdependence.

Opportunities for cooperation

should continue to expand rapidly,
not just on regional issues but also
GROWTH AND with respect to the region’s role in
INTEGRATION
the world economy.
 ASIA IN 2020
Since trade and finance are also key
drivers of regional integration, their
continued development will increase
interdependence. And because the region’s
growth and integration feed on each other,
opportunities for cooperation should
continue to expand rapidly, not just on
regional issues but also with respect to the
GROWTH AND region’s role in the world economy.
INTEGRATION
 How markets
drive
integration

How policy
Measuring
makes are
interdependence
responding

THE RISE OF
REGIONALISM
MEASURING
INTERDEPENDENCE
The most common measure of
interdependence—the share of a
region’s total trade conducted within
it.

Asia is now broadly as

interdependent in trade as the EU
and North America each is. THE RISE OF
REGIONALISM
MEASURING
INTERDEPENDENCE
A still broader measure of
interdependence needs to include
other important channels such as:

• direct investment
• financial flows
• macroeconomic links
• personal contacts
THE RISE OF
REGIONALISM
MEASURING
INTERDEPENDENCE

To this end, data on six

indicators of Asian economic
integration were collected for each
Asian economy before and after the
crisis.

THE RISE OF
REGIONALISM
 Trade policy
MEASURING
Tourism (0.61 – 0.65)
cooperation (0.43 –
0.65)
INTERDEPENDENCE
A still broader measure of
interdependence needs to include other
Foreign direct
important channels such as direct investment,
Intraregional trade
investment (0.52 –
(0.35 – 0.52)
financial flows, macroeconomic links, 0.72) and

personal contacts (Chua 2004). To this end,

data on six indicators of Asian economic
integration were collected for each Asian
economy before and after the crisis. Equity markets(0.27–
Macroeconomic links 0.53) THE RISE OF
(0.07 – 0.54) REGIONALISM
HOW MARKETS DRIVE
INTEGRATION

• Asian Integration

THE RISE OF
REGIONALISM
APPROACHES IN
INTEGRATION
• Supranationalism
• Intergovernmentalism

THE RISE OF
REGIONALISM
SUPRANATIONALI
SM An alliance involving 3 or more
countries for their mutual benefit such as
economic, cultural or political/ military.

The breakup of a country into smaller

countries due to a conflict within the
country.

THE RISE OF
REGIONALISM
SUPRANATIONALI
SM An alliance involving 3 or more
countries for their mutual benefit such as
economic, cultural or political/ military.

The breakup of a country into smaller

countries due to a conflict within the
country.

THE RISE OF
REGIONALISM
INTERGOVERNMENTALISM
• seeks to understand the
reasons why states join
together and to provide a
realistic approach to the
analysis of regional
integration mechanisms

THE RISE OF
REGIONALISM
HOW MARKETS DRIVE
INTEGRATION
• Asian Integration
• Regional Relationships
• Technology and Policy

THE RISE OF
REGIONALISM
HOW MARKETS DRIVE
INTEGRATION
The key technological explanation—
the development of production
networks, often also described as
“production fragmentation”

THE RISE OF
REGIONALISM
PRODUCTION
FRAGMENTATION
It is the result of advances in
information technology, falling trade
barriers, and declining transport costs.

THE RISE OF
REGIONALISM
 HOW POLICY MAKERS ARE
RESPONDING
Partners outside Asia
VS
Market - driven
integration

THE RISE OF
REGIONALISM
 HOW POLICY MAKERS ARE
RESPONDING
REGIONAL ORGANIZATIONS

• Asia-Pacific Economic Cooperation (APEC)

• United Nations Economic and Social

Commission for Asia and the Pacific (ESCAP)

• Mekong River Commission

• Southeast Asia Treaty Organization (SEATO)

THE RISE OF
REGIONALISM
 HOW POLICY MAKERS ARE
RESPONDING
ASEAN countries have been at
the forefront of Asian regionalism,
individually and collectively.

The Central Asia Regional

Economic Cooperation [CAREC] have
focused on the special requirements of
THE RISE OF
REGIONALISM
geographical subregions.
 HOW POLICY MAKERS ARE
RESPONDING
ASEAN seeks to transform their
economies into a “single market”.

ASEAN+3 [ASEAN countries

plus the PRC, Japan, and the
Republic of Korea] have addressed
functional areas of integration.
THE RISE OF
REGIONALISM APEC have been most effective
among all.
REGIONAL INTEGRATION IN ASIA

APEC(FTAAP)

Canada, Chile, Hong Kong, Mexico, Papua

New Guinea, Peru, Russia, Chinese Taipei, U.S

ASEAN+6
Australia, New Zealand
India
ASEAN+3
China, Japan, Korea
ASEAN

Brunei, Indonesia, Malaysia,

the Philippines, Vietnam, Cambodia, Laos,
Singapore, Thailand Myanmar
 Macroeconomics

Social and
Financial
environmental
Markets
issues

THE
EMERGING
Production
REGIONAL Cooperation
AGENDA
PRODUCTION
Access to markets, in the region
and beyond, is critical to Asia and thus
a high priority on the regional agenda.

Institutional arrangements are

designed to facilitate the free flow of THE
EMERGING
goods and services and to coordinate REGIONAL
with foreign economic policies AGENDA
between countries in the same
geographic region.
PRODUCTION
NORTH AMERICA FREE TRADE
(NAFTA)

The pact effectively created

a free-trade bloc among the
three largest countries of North THE
EMERGING
America. REGIONAL
AGENDA
PRODUCTION
ASEAN Free Trade Area (AFTA)

The liberalization of trade in

the region through elimination of
both intra-regional tariffs and
non-tariff barriers had THE
EMERGING
contributed towards making REGIONAL
ASEAN's manufacturing sectors AGENDA

more efficient and competitive.

FINANCIAL
MARKETS
Financial regionalism has also increasingly
gained prominence.

Leaders of the group of twenty advanced

and developing economies meeting in Los Cabos,
Mexico, underscored “the importance of effective
global and region safety nets”;.

The main policy committee of the IMF has THE

EMERGING
regularly stated the importance for the IMF “to REGIONAL
cooperate . . . with regional financial AGENDA
arrangements.”
FINANCIAL
MARKETS
LATIN AMERICAN RESERVE FUND
(FLAR)

It is very active in providing THE

balance of payments financing to its EMERGING
REGIONAL
members for more than three AGENDA
decades.
 FINANCIAL
MARKETS
THE CHIANG MAI INITIATIVE

It is a multilateral arrangement
among the finance ministries and
central banks of the ASEAN+3
member countries and the Hong
Kong Monetary Authority that THE
provides currency swap transactions. EMERGING
REGIONAL
AGENDA
MACROECONOMICS
Interdependence
generates spillover and
enhances the need for
cooperation.

THE
EMERGING
REGIONAL
AGENDA
TYPES OF MACROECONOMIC POLICY
COOPERATION
-Information Sharing
-Regime Setting

Some experts argue that Asia is

decoupling from the World Economy.

THE
EMERGING
REGIONAL
AGENDA
 SOCIAL AND ENVIRONMENTAL
ISSUES
As well as driving Asian
dynamism, regional cooperation
could help ensure that its benefits
are sustainable and widely shared.

THE
EMERGING
REGIONAL
AGENDA
 SOCIAL
ISSUES
-Poverty
-Inequality
-Unemployment and
Underemployment

THE
EMERGING
REGIONAL
AGENDA
 ENVIRONMENTAL
ISSUES
-Water Bodies
-Air Pollution
-Climate Change

THE
EMERGING
REGIONAL
AGENDA
 SHORT - TERM MEDIUM AND LONG -
MEASURES TERM MEASURES

• Promote investment by small and

• Foster an attractive investment medium enterprises
environment
• Establish a regional financing facility
• Develop resources and infrastructure
• Promote closer regional marine
• Cooperate through technology environmental cooperation
transfers and joint
technology development • Build a framework for energy policies
and strategies, as well as action
• Establish poverty alleviation programs
plans
• Take concerted steps to provide access
• Work closely with nongovernment
to primary health care for the people
organizations
 COOPERATIO
N
Marshaling collective efforts
across Asia’s vast, diverse economies
is a huge challenge.

The examples of the EU and, to a

THE
EMERGING
lesser extent, NAFTA offer insight, but
REGIONAL Asia’s economics, politics, and history
AGENDA are different—and call for new,
distinctive solutions.
 Asian COOPERATION
institutional
development will likely remain
pragmatic and gradual, and the
region’s policy architecture will
likely feature multitrack and
multispeed solutions.
THE
EMERGING
REGIONAL The region is already highly
AGENDA integrated, and its governments are
aware of their common interests
 COOPERATION
Asia has returned to stability
and growth, and elimination of
systematic poverty is within reach.

To be sure, important
THE
EMERGING
problems remain, and regional
REGIONAL cooperation will require complex
AGENDA
and delicate decisions.