Can Regional Integration in Asia Achieve a Similar Degree of Regional Interdependence as Western Europe - Essay Example

Can regional integration in Asia achieve a similar degree of regional interdependence as Western Europe? Deepening regional integration among Asian countries is a unique and interesting socio-economic model proposed and patterned after the European Community style of regional merger experience. Yet issues and challenges are bound to be raised such as whether Asia’s economic, geographic, political dimensions, challenges, and realities will augur well to achieve a similar level of success that Europe experienced. To help us understand and find out if such regional integration in Asia may succeed as it is envisioned, we will compare and contrast the said region with Europe in terms of patterns of history, economy and realities. Finally, as we conclude this essay, we will discuss lessons learned from the degree of regional interdependence that Western Europe has achieved, that can thus, be compare with Asia’s drive for the same agenda. Understanding regional integration. Why all the fuzz? It is said it is best to postpone any attempt to define what regional interdependence, regional merger or regional integration means as fleshing out a meaning for this invaribly changing concept is elusive, without first looking into the history and objective or goal this economic integration model envisage. From researches, policy reports and conferences outcomes we gathered, deepening the regional integration was helmed following series of talks and discussions with the pan-Asian sphere about moving to take advantage of globalization with caution and concern that recurrence of the 1997 crisis in Asia might be avoided. With integration, this means strengthening and reinforcing policy actions for trade, economic surveillance, balance of payments support and the financial sectors. It is in the belief that freeing several economic barriers within countries and nations will be best complemented by integration among and between nations. When such developments happen, flow of goods, services, people and capital will freely move minus the interruptions or distractions brought about by complex barriers at each nation’s territorial domains and other non-tariffs barriers. Another goal of this regional economic integration, patterned after Europe’s experience, is to create an economic and monetary union and to adopt a single currency market, that will spur and consolidate its vision for a consolidated and more unified European single financial market. Some goals and visions developed, following Europe’s experience, expedite the development of systems for policy coordination, thus, aims were established that will compel compliance to these macroeconomic policies and structural reforms in the markets for goods, labor and financial products. Asia and Europe economic models for integration, compared Regional integration in both Asia and Europe may be similar yet different in some ways, particularly in terms of policical ambitions, economic dimensions and timing of integration process, among others. Here are as follows – 1) Economic pattern. Asia is more diverse economically in terms of nations that comprised it. Whle some are rich, some are extremely poor, mostly with rural and traditional structures. Europe, however, has espoused a more pronounced homogenous economic grouping; 2) Deepening regional integration timing. Europe is more politically willing and explicit to integrate, which has started since 1945, following the second world war. Asia, meanwhile, does not seem to feel the pressure much the same way that Europe did, reflecting an uncomfortable low political ambition to push through with the de facto integration that is taking place. Several factors that may have contributed to this may be attributed to Asia’s very different geographical, historical and economic conditions. Using Zhang Yunling’s checklist of Asia’s identity, which are – geographic, economic, political, and others –Europe and Asia share similarities in terms of the following – 1) both regions are interested in systems that encourages open international economic and financial program as it contend with scarce natural resources; 2) having survived the serious blow of economic, banking and currency crises in the nineties (i.e., Europe with 1992-1993 ERM crisis and Asia with 1997 financial crisis), partly as a result of efforts undertaken to achieve stable economic and financial system; and 3) complex models of society are very apparent in both regions, putting high alert for them to adopt policies that will keep them attuned with the forces of globalization, yet flexible enough to adapt in any rapidly evolving contexts. Can Asian regional experience succeed? Lessons learned In reality, institutional integration moves are costly, demanding and lastly, obligatory. Europe’s call to integrate stem from pressures to catch up with the United States. The same with Asia’s case which was geared to catch up with Europe and US, all in the need to heed the call of global liberalization. It cannot be ignored nor denied Europe’s transformation into a regional economic behemoth as it is known today, had never met pressures and tiresome challenges, particularly in view of the conditions or policies it will be ready or willing to take, adopt or risks losing. Furthermore, moves pushing for regional integration in Asia is heavily battered with challenges for its lack of clear direction. There are still a lot of issues to contend with and address in terms of direction to take for the economic integration of Asia – 1) foremost, and an essential one, is whether interdependence effort is leading towards freeing much trade barriers in the region; 2) are there some lobbying that is being made to promote or support national interests of certain parties, i.e., Europe? or the United States? and, 3) With the inclusion in the picture of China, Japan and India, three most influential giants, how will fears of domination over the smaller nations be allayed? Answering these key issues or questions may not readily support our quest for a united Asia but at least, can provide a stamina to consistently enliven our hopes and aspirations. With the US and Europe already showing full support for the integration, however, under all circumstances, it may not work. Full compatibility with global multilateral accords needs to be assured and pressed towards regional integration. It is also worth noting that Europe’s lessons in some areas during or after the integration may not or cannot simply be applied to another areas in any circumstance. Yet with the interplay of globalization, cross border elements such as environment, terrorism threats, military threats and common resources management, may encourage Asia to adopt most of the ways used by Europe of ensuring that integration and cooperation were effective (i.e., rationales to be determined, multilateralizing bilaterial pacts, private sector involvement). Real convergence is said to be implied by necessity as an effort to be adopted when trying to arrive at a meaning out of the vision and efforts with the integration proposal for Asia, in order to reach lasting macroeconomic and financial sector stability. The eventual success of the European Union’s single market program, an ambitious project of high-reaching structural reforms in almost all economic sectors, notwithstanding the positive support provided by global trade liberalization, afforded key support for the progress made within the Economic and Monetary Union and the launch of the single currency. In view of this, beside trade liberalization agenda only, common action plans - in particular in the financial sector and capital movements - must be developed. And lastly in response to our question, Can regional integration in Asia achieve a similar degree of regional interdependence as Western Europe? It can either be yes or no. However, it is still too early to tell whether the ideals and prospects for its full realization might surface soon as the real thing for Asia. The least that it can be predicted is that such regional interdependence may currently be experiencing some evolution, or it may be deeply in search for an identity. Not European, not American, but Asian, in all its genuine heritage. Sources Cited Asian Regional Integration Coming of Age, Baker Says http://www.america.gov/st/washfile-english/2004/June/20040607170235ASesuarK0.8383295.html Economic Integration in East Asia and Europe - A Comparison Werner Pascha of Universitat Duisburg-Essen, Germany http://www.uni-duisburg.de/FB5/VWL/OAWI/ARBEITSPAPIERE/AP68.pdf European Commission’s Study on Regional Economic Integration in Asia and Europe http://www.mof.go.jp/jouhou/kokkin/tyousa/tyou059.pdf The East Asia Summit: More Discord than Accord Mohan Malik YaleGlobal, 20 December 2005 http://yaleglobal.yale.edu/display.article?id=6645 Asian Economic Integration - Current Status and Future Prospects - Prospects for Economic Integration in Asia: Approaches from Political economy (The Way Ahead) http://www.rieti.go.jp/en/events/02042201/report_23pm.html Regional integration initiatives in the asia pacific: Trade and finance dimensions Hadi Soesastro http://www.pecc.org/PECC2003Brunei/papers/trade-workshop/session-2/soesastro.pdf Read More