Philippine E-Journals

ASEAN Trade Integration 2015

Adrian M. Tamayo

Discipline: Social Science

 

Abstract:

The creation of the Association of Southeast Asian Nations (ASEAN) was to form a trade bloc that could compete in the world economies. The ASEAN integration on 2015 is also seen as externally influenced. This study aimed to determine the predictive relationship between and among the ASEAN countries, and the ASEAN countries with the Free Trade Agreement (FTA) countries such as Australia, China, United States, Japan and New Zealand. The study employed the vector autoregression (VAR) to determine the predictive relationship of the ASEAN with the free trade countries. Indonesia had a predictive relationship with Japan and Laos. Malaysia had predictive relationship with Thailand, Vietnam, Laos, Japan, Indonesia. Meanwhile, Philippines had predictive relationships with Vietnam, Japan, China, Australia and United States. Singapore showed predictive relationship with Laos, New Zealand, Thailand, Vietnam, Australia, Japan, Malaysia, Philippines, United States and Vietnam. The economy of Thailand was found to show predictive economic relationship with Australia and a strong economic relationship with Japan, Laos, New Zealand. While Vietnam maintained predictive relationship with New Zealand, Philippines, United States, Australia, Japan, and Philippines. Laos, on the other hand, was influenced by Indonesia, New Zealand, Japan, Thailand and United States. In conclusion, the success of the trade integration of ASEAN also depends on other non-ASEAN countries.