ADB to develop economical model between East & South Asia

20 Feb '06

2 min read

Asian Development Bank (ADB) announces that ADB's Office of Regional Economic Integration (OREI) will study how to facilitate more effective economic cooperation and integration between developing countries in East and South Asia.

Over the past decade, East Asia, excluding Japan, and South Asia were two of the fastest growing subregions in the world. In spite of their rapid growth, however, economic integration between the two subregions has increased only modestly.

The potential for sustaining high rates of growth in the two subregions through enhanced cooperation and integration is large. Both regions stand to gain from the consequent expansion of the market for goods and services, increased economies of scale, greater competition, lower prices, and more foreign direct investment.

"However, research on the implications of economic cooperation between subregions within Asia is relatively scarce. Such research is necessary to inform policymakers about the types and sequence of policies to garner support for, and gain from, regional economic cooperation," says Ganeshan Wignaraja, an ADB Senior Trade Economist.

OREI will develop a model that will estimate the potential effects of trade liberalization under various scenarios. The model will allow them to identify sectors that have the potential to make significant gains from cooperation, and specify policy options at the regional, subregional, and country levels needed to realize those benefits.

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