East Asia should cooperate on free trade agreements

It is heartening to see Asia’s most powerful economies talking cooperation and attemping to form a free trade area. It was not long ago that the three big Asian powers – Japan, China and South Korea – would not talk to each other because of their ill-feeling towards one another. Now, it is amazing to see them getting together to talk trade. They are planning a big project – to create one of the world’s most powerful free trade areas. 

With the modern economies of Japan and Korea and China having the world’s largest market of over 1.2 billion people, the world can indeed benefit from their cooperation. Of course, there are obstacles that have to be crossed before there is a free trade area. Each country has its unique problems and issues to deal with, especially when it comes to sensitive agricultural products.

At last week’s meeting in Beijing, there seemed to be one of the best atmospheres ever between the three. They now know that only through cooperation can the region’s stability and prosperity be secured. They also rejected the ongoing threats generated by North Korea. Their joint statement will send a strong signal to North Korea’s new leader, Kim Jong-un, that any attempt to divide these three countries will be futile. 

The three countries must work quickly to establish their free trade area because there are other regional free trade blocs that are in the works. The US has already given a big push for the TPP (Trans-Pacific Partnership). Japan will soon begin negotiations with the TPP group. Within Asean, the Asean +3 free trade area, which is a comprehensive economic partnership in East Asia, is also in the making. If the trio can complete their own free trade area it will give the Asian region a shot in the arm as far as economic integration is concerned.

Asean should be glad to see the trio working well together. For nearly a decade, they have used the Asean +3 meeting as the venue for their meetings and confidence building. It wasn’t until 2008 that they decided to move away from the Asean +3 framework to strike out on their own cooperative effort

Of course, it is imperative for Asean to move quickly and consolidate the regional grouping’s integration. The Asean Economic Community is moving towards completion, although the Asean members will have to work harder to improve the score on full economic integration, which is standing at around 80 per cent. At the moment, Asean members can measure their economic cooperation. For political and security cooperation, as well as social and cultural cooperation, there is still no quantitative measurement for the time being.

As long as the three Asian giants continue to work together, the prospects for the region look good. China is the economic giant that is pushing the region’s economy forward, especially at this time when Japan has been facing economic difficulties. South Korea is enjoying an economic boom due to IT exports despite the non-stop threats from its belligerent neighbour to the north.

Close cooperation in trade in East Asia will also benefit the global economy, especially at this point in time when Europe’s economies are in dire straits.