An Empirical Estimation of Asia's Untapped Regional Integration Potential Using Data Envelopment Analysis

Abstract

The views expressed in this paper are those of the author and do not necessarily reflect the views and policies of the Asian Development Bank (ADB) or its Board of Governors or the governments they represent. ADB does not guarantee the accuracy of the data included in this publication and accepts no responsibility for any consequence of their use. By making any designation of or reference to a particular territory or geographic area, or by using the term "country" in this document, ADB does not intend to make any judgments as to the legal or other status of any territory or area.

South Asia: Multilateral trade agreements and untapped regional trade integration

“…While, the F ‐statistic for Sri Lanka falls below the lower bound, shows that Sri Lanka trade is not cointegrated in South Asian region. The results are not consistent to earlier studies which highlight the narrow trade integration in South Asian region (see Arora & Ratnasiri, 2014; Das, 2007; Naeher, 2015; Pitigala, 2005).…”

“…Furthermore, the study of Ding and Masha (2012) highlights that the trade and financial openness in South Asia are found low than that of other Asian counterparts because of man made barriers. Naeher (2015) finds that East Asia and South East Asia have achieved an effective level of integration. Whereas, the South Asia and the Central Asia are found to have largest potential for trade integration in the Asian region.…”

“…The man made barriers, and the actual and perceived threats are very much part of the problem in the way of intraregional trade in South Asia. For example, Naeher (2015) reports that Western European countries of European Union (EU) are highly integrated as compared to Asian countries where the half of its current potential is not achieved in regional integration.…”

Trade within South Asia: Unrealistic Expectations

“…However, the other members are not able to meet the needs of the large import basket of India, due to which India has to depend upon non-member countries for much of her import requirement (Abbas & Waheed, 2017; Grancay & Dudas, 2019; Mahmood & Nishat, 2004; Naseer et al, 2019). But this does not mean that there is no further scope of trade increments, as some analysists suggest a perceptible untapped estimated trade potential in SAFTA (Naeher, 2015). If ways can be found to bring this trade potential under the ambit of intra-regional trade, then intra-block trade is of course likely to increase (Suneja, 2018; World Bank, 2016).…”

Enhancing Regional Economic Cooperation and Integration in Asia and the Pacific

“…2 The composite measure was constructed using on the following variables: trade and investment, monetary and financial integration, and cross-border mobility of peoples. For a full definition of the index and explanation of the indices please see Naeher (2015).…”