2

2

ISBN978-4-904618-05-9

March 2010

The Ministry of Education, Culture, Sports, Science, and Technology began in 2007
the Global COE (Center of Excellence) Program with the primary aim of developing
creative human resources to lead the world and internationally competitive universities in Japan. The Global Institute for Asian Regional Integration (GIARI) of the
Graduate School of Asia-Pacific Studies, Waseda University is one of the twelve sites ininterdisciplinary, combined, and new fields selected from among numerous applicants
throughout the country.
The Global COE program at GIARI has two aims: to develop competent professionals who will contribute to regional cooperation and consolidation, and to build a
center for this purpose. The program has three areas of study: (1) political integrationand identity; (2) economic integration and sustainability; and (3) social integration andnetwork, and the three areas are organically interconnected. The program is buildinga theoretical framework for regional governance, allowing Ph.D. candidates to participate in different projects to develop multidimensional and comprehensive perspectives,and has already produced many results in this endeavor. The program also encourages
research and other activities to create strong networks with other institutions of higher
learning in the region and also to collaborate with government agencies, public organizations, and NGOs in order to build a world-class research center at Waseda University.

Managing Editor
Tsuneo Akaha
Director, Center for East Asian Studies, Monterey Institute of International Studies
Senior Fellow, Global Institute for Asian Regional Integration (GIARI)

Associate Editor
Sachiko Hirakawa
Junior Researcher, Waseda University Institute of Asia-Pacific Studies
Assistant Professor, Global Institute for Asian Regional Integration (GIARI)

Editorial AssistantMitsuko Akaha
Graduate Student, Monterey Institute of International Studies

Editorial Board
Satoshi Amako Chairperson

Tran Van Tho

Rumi Aoyama

GIARI Project Leader; Professor,
Graduate School of Asia-PacificStudies, Waseda University

Professor, Graduate School of Social
Science, Waseda University

Professor, School of Education,
Waseda University

Shujiro Urata

Takashi Terada

Michio Yamaoka

Professor, Organization for AsianStudies, Waseda University

Professor, Graduate School of AsiaPacific Studies, Waseda University

Mitsuhide Shiraki

Kazuhiko Yokota

P r o f e s s o r, G r a d u a t e S c h o o l o f
Economics, Waseda University

A s s o c i a t e P r o f e s s o r, S c h o o l o f
Commerce, Waseda University

Naoyuki Umemori

Tomoko Ako

Professor, Graduate School of Political
Science, Waseda University

A s s o c i a t e P r o f e s s o r, S c h o o l o f
International Liberal Studies, Waseda
University

Professor, Graduate School of AsiaPacific Studies, Waseda University

Shunji Matsuoka
Professor, Graduate School of AsiaPacific Studies, Waseda University

Kazuo Kuroda
Professor, Graduate School of AsiaPacific Studies, Waseda University

Hatsue Shinohara
Professor, Graduate School of AsiaPacific Studies, Waseda University

Chikako Kawakatsu Ueki

Ken'ichi Akao
Professor, Graduate School of Social
Science, Waseda University

Koichiro Kudo

Professor, Graduate School of AsiaPacific Studies, Waseda University

D i r e c t o r, D i s e a s e C o n t r o l a n dPrevention Center (DCC), International
Medical Center of Japan

Yukiko Fukagawa

Yasushi Katsuma

P r o f e s s o r, G r a d u a t e S c h o o l o f
Economics, Waseda University

Professor, Graduate School of AsiaPacific Studies, Waseda University

Vol. 2

Published by
Waseda University Global COE Program
Global Institute for Asian Regional Integration(GIARI）
Graduate School of Asia-Pacific Studies, Waseda University
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Printed by Noto Printing Corporation
ISBN 978-4-904618-05-9

Graduate School of Asia-Pacific Studies, Waseda University
Global COE Office
Nishi-Waseda Bldg. 5F#507,1-21-1 Nishi-Waseda, Shinjuku-ku,
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Published by
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Global Institute for Asian Regional
Integration(GIARI）

Contents
Editor’s Note

Tsuneo Akahai

Contributors
iii

Globalization's Convergence Effect on Human Quality of Life (QOL) in Asia: Evidence from the
KOF Index of Globalization
Jeet Behadur Sapkota

1

Significance of the Japan-India Partnership for East Asian Regionalism
Céline Pajon

29

Banking on East Asian Integration? Implications of Global Financial Crisis for Regionalism
Bernard Ong

52

The Nexus between Traditional and Non-Traditional Security Cooperation in Japan-China Relations: Environmental Security and the Construction of a Northeast Asian Region
Christian Wirth69

Asian Integration's Low Visibility in the United States Elite Press: A Vicious Cycle of Rational Ignorance?
Troy Keith Knudson

87

Reviving Japanese "Traditional" Industries: Prospects and Strategies for Asian Regional Integration
Jennifer Beamer

101

Book Review Essays
Mireya Solis, Barbara Stallings, and Saori N. Katada, eds., Competitive Regionalism: FTA Diffusion in the Pacific Rim, New York: Palgrave Macmillan, 2009.
Masato Kamikubo

114

Vinod K. Aggarwal and Shujiro Urata, eds., Bilateral Trade Arrangements in the Asia-Pacific: Origins, Evolution, and Implications, New York: Routledge, 2006.
Jemma Kim

120

Editor’s Note
Tsuneo Akaha
Asian Regional Integration Review (Vol. 2) includes six research articles and two
book reviews. As in the first volume published in 2009, the research articles containedin the current volume were written by young scholars who presented earlier versions at
the Summer Institute on Regional Integration 2009, organized by the Global Institute for
Asian Regional Integration (GIARI), Waseda University. The Institute, as in the previous year, provided an excellent opportunity for Ph.D. students from around the world todiscuss their research-in-progress with their peers and more senior scholars in attendance.
Most students who participated in the Institute submitted their revised papers for consideration for publication in the Review and the papers were reviewed by faculty of Waseda
University for relevance, timeliness, substantive depth, and originality. Six of them wereselected for further revision and for inclusion in this volume.
All articles selected for this volume deal with contemporary issues related to regional integration in Asia. Sapkota’s statistical analysis documents the impact of regional integration, seen as part of globalization, on the reduction of poverty gap between the developed and developing countries of Asia. His findings support regional integration as a wayof spreading the benefits of liberal globalization in the region. Pajon’s article looks into
the motives behind Japan and India’s ongoing efforts to boost their political and economic
ties, and the implications for East Asian regional integration. She sees promising signs ofbilateral cooperation, in part as a result of China’s rise, but also its limits. Ong’s qualitative analysis explores the proposition that the current global-regional economic-financial
crisis will help strengthen the momentum toward regional integration in East Asia just as
the 1997-98 Asian financial crisis did. He finds very mixed results. Wirth compares theform and scale of bilateral cooperation between China and Japan in traditional and nontraditional security fields to examine the hypothesis that non-traditional security issues are
more conducive to bilateral cooperation than traditional ones. The author states that theevidence is inconclusive but that the proposition is still plausible. Knudson’s analysis of
the New York Times coverage of Asia-related topics confirms his impression that there isa lack of media attention in the United States to the growing regional integration trends inAsia, and it posits implications for regional integration without substantial US participa-ition. Beamer provides a case study of a Japanese folk art to explore the potential of traditional art
to provide a cultural value linkage between communities across national borders. All of the studies presented here are exploratory and do not offer definitive conclusions on the questions theyraise. However, they represent promising attempts at applying theoretical and empirical studiesof the more senior scholars in the field and also suggest some novel approaches and topics thatbeg for further research. The two book reviews by Professor Kamikubo and Professor Kim introduce recent analyses of competitive regionalism and FTAs and provide a timely assessment of
the advances being made in the study of Asian regional integration.
The Managing Editor was ably assisted by Professor Sachiko Hirakawa (Associate Editor)
and Ms. Mitsuko Akaha (Editorial Assistant) in the editing work, as well as by Ms. Atsuko Tsuriya (GIARI) in logistical matters, and he is grateful to them. Thanks also go to all of the article
authors in this volume for their timely cooperation in revising their contributions and responding
to the editorial staff’s queries.

ii

Contributors
Jennifer Beamer
Ph.D. Candidate, Interdisciplinary Studies-Material Culture and Japanese Society, University of Alberta, Canada

Masato Kamikubo
Visiting Junior Researcher, Waseda University Institute of Asia-Pacific Studies
Visiting Assistant Professor, Global Institute for Asian Regional Integration (GIARI)

Jemma Kim
Junior Researcher, Waseda University Institute of Asia-Pacific Studies
Assistant Professor, Global Institute for Asian Regional Integration (GIARI)

Troy Keith Knudson
Ph.D. Candidate, Graduate School of Asia-Pacific Studies, Waseda University
Research Fellow, Japan Society for the Promotion of Science

Bernard Ong
Former Head, International Relations, Ministry of Education, Singapore
Ph.D. Candidate, Graduate School of Asia-Pacific Studies, Waseda University (From April 2010)

Céline Pajon
Ph.D. Candidate, French Institute of Geopolitics, University Paris 8
Junior Research Fellow, French Institute of International Relations (IFRI)

Jeet Behadur Sapkota
Ph.D. Candidate, Graduate School of Asia-Pacific Studies, Waseda University
Research Fellow, Global Institute for Asian Regional Integration (GIARI)

Christian Wirth
Ph.D. Candidate, Graduate School of Asia-Pacific Studies, Waseda University
Research Fellow, Global Institute for Asian Regional Integration (GIARI)

iii

Globalization’s Convergence Effect on Human Quality of Life (QOL) in
Asia: Evidence from the KOF Index of Globalization1

Jeet Bahadur Sapkota

Abstract
The impact of globalization on human quality of life (QOL) is an issue highly debated byacademics, policy makers, the private sector, social organizations, and even by the general publicin Asia and elsewhere in the world. There is no doubt that globalization has had a significant impact on the lives of millions of Asian people; however, it is unclear that globalization has reduced
or increased the gap in human QOL among the rich and poor countries. This paper examines
whether human QOL in the Asian countries is converging (or diverging), and assesses the impact
of globalization on QOL trends in the region. Using panel data of selected countries from 1975
to 2005 over five-year intervals, and applying the dynamic panel data model, the study finds thathuman QOL of most countries in the region is moving closer to that of Japan (the benchmark
country in this study) and that globalization has significant impacts on this convergence. Morespecifically, overall indicators of human QOL, measured by the human development index (HDI),
is converging in Asia and the overall as well as economic, social, and political indicators of globalization are highly significant in the convergence process. Similarly, a disaggregated analysisof the sub-constructs of HDI shows that health and education indicators are also converging,and globalization indicators have a significant impact on the convergence process. Although
the income aspect of QOL is found to be diverging sharply, the globalization indicators are notsignificant on the divergence process and the shrinking gap in health and education indicators
outweigh the income gap, which leads the overall human QOL convergence in the region. To
complement these findings, the paper calls for a study of some country cases, as well as a studyof the impact of globalization on human QOL inequality within countries. Such studies, the paper
concludes, will facilitate the development of specific policy recommendations tailored towards
countries in their cultural context, with a positive (or at least neutral) impact of globalization on
the reduction of human QOL gaps within them.

1. Introduction
The modern world economy and society are globalizing at a more rapid pace than everbefore2 and Asia is one of the regions most affected by the current wave of globalization politically, economically, and socially.3 Consequently, the impacts of globalization and its various dimensions have been widely debated and examined by academics, politicians, policymakers, theprivate sector, and even by the general public in Asia. However, there is no consensus regarding
how the benefits of globalization are distributed among Asian countries and their populations.
Although most of the theoretical and empirical literature on the convergence hypothesis claims
globalization should help reduce the gap between the rich and poor,4 the convergence effect of
globalization on the human quality of life (QOL) within Asia is still a matter of debate and israrely explored.
Nonetheless, there are a significant number of studies that assess the impact of globalization
within Asia. For instance, a comprehensive study by the World Bank confirmed that the sustained1and rapid economic growth in East Asia is more equally distributed than in any other region of
the world.5 Furthermore, Yusuf claimed that the so-called East Asian Miracle helped global
income convergence, as a number of economies from the region grew significantly faster than the
average for the member countries of the Organization for Economic Cooperation and Development (OECD).6 However, these studies mainly focused on income or materialistic achievements
following the conventional wisdom of globalization research.7 Of course, income is an importantpart of QOL, but health and education are as well8; hence, these aspects should receive similar research efforts. In this regard, recent works by Kenny assessed empirically the global convergence
on QOL variables.9 Kenny also evaluated the case of East Asia.10 However, in his analyses, he did
not introduce any aspect of globalization as an explanatory variable, nor did he assess the overall convergence of QOL. Instead, he measured the convergence of different elements separately
and found that some were converging and some were not. The present study attempts to narrow
the gap in this area of research by offering an analysis of the current situation of convergence ofoverall human QOL in terms of human development index and its components within the region,
while undertaking an exploration of the effect of globalization in this convergence (or divergence) process.
The article is organized as follows: Section 2 introduces the KOF indexes as the working
definition and measurement of globalization, and the human development index as the measureof human QOL. The section also highlights the current global as well as Asian trends of these key
indicators. Section 3 examines the convergence of human development in the region and finds
clear evidence of convergence. It also briefly discusses the reasons behind this finding. Section 4
empirically tests the impacts of globalization on this convergence process. The section presents
the methodology and the results simultaneously and shows, as expected, a significant contribution of globalization to the convergence of human development. Finally, Section 5 offers a brief
discussion on the findings and suggests further research.

2. Globalization, Human QOL, and Its Trend in Asia
Since the end of the Cold War and the resurgence of neo-liberal economic policy as thedominant approach to economic development and international economic relations, contemporary globalization has not only become a central concern to the donor community and policymakers, but it has also drawn due attention from academics, non-governmental organizations, andeven from the general public.11 Globalization is one of the most controversial issues whose many
aspects are questioned and debated, the discussion including the scope, structure, reality, andmeaning of globalization itself.12 Thus, it is very hard to define globalization in a way that satisfies all stakeholders. This study takes the most comprehensive definition and indicator of globalization based on academic literature on the impact of globalization.
Most of the empirical studies in relation to the so-called third wave of globalization13 employ proxies such as trade, capital flows, and openness as measures of globalization, and they use
cross-section data.14 For example, Heinemann showed that more open countries had lower increments in government outlays and taxes15 and Vaubel found more open countries having lower
government consumption.16 Rodrik also used cross-section data and found no effects of capital
account openness on economic growth.17 Recently, however, some scholars have used panel data
to find the effects of globalization and have shown positive impacts of openness on growth andpoverty but revealed mixed impacts on income inequality.18
These detailed studies, however, fail to consider the overall effect of globalization, as they
focus on individual dimensions of globalization. As all the dimensions of globalization arestrongly related to each other and are important in explaining the consequence of globalization,2

omitting such important variables from the regression equation can generate severely biased coefficients.19 In addition, as mentioned earlier, most of these studies, motivated by conventional
wisdom, focus solely on economic growth, income poverty, and income inequality.
To correct these shortcomings, this study uses the KOF Index of Globalization developedby Dreher, which is considered the most comprehensive indicator of globalization available.20
Although there is another measure of overall globalization developed by A.T. Kearney/Foreign
Policy Magazine,21 it only ranks the countries in terms of globalization, and the ranking is only
available for recent years. Thus, the A.T. Kearney Index of Globalization cannot be used for the
purpose of this study.
To define globalization by formulating the KOF Index of Globalization, Dreher referred tothe definition given by Keohane and Nye, among others,22 and he summarized the definition of globalization in the following three dimensions:• economic globalization, characterized as the long-distance flow of goods, capital, and services as well as information and perceptions that accompany market exchanges;• political globalization, characterized by a diffusion of government policies; and,• social globalization, expressed as the spread of ideas, information, images, and people.23
Dreher then considered all possible elements for each dimension of globalization and developed the indexes of economic, social, and political globalization by employing appropriate
weights systematically for each component following the methodology of Gwartney and Lawson.24 The components of each aspect of globalization were transformed on a zero-to-ten scale
before the principle components technique was used to construct a weighted summary index
for individual dimensions of globalization. Then the indexes of economic, social, and politicalglobalization were combined into a single index of overall globalization, giving the respective
weights for each dimension. The single index is named the KOF Index of Globalization, and it is
the working definition and measure of globalization in the present study. Appendix I presents theelements considered and weights assigned to calculate the KOF Index of Globalization.
Figure 1, based on the KOF Indexes, presents the trends of the three types of globalization.
Representing the high turmoil in international security as well as an increasing role of global
governance, political globalization fluctuates more at higher levels. In comparison, economic
globalization has a rather steady upward trend. Although social globalization has the lowest index value, the progress goes along with the pace of other forms of globalization. Overall, globalization has moved faster since the beginning of the 1990s, when the five-decade long Cold War
ended.
The globalization trends in Asia are somehow different from the global trends. As shown in
Figure 2, Asian globalization is highly driven by economic factors. Political globalization wasvery weak before 1990, but it has gained significant momentum since then. The trend of social
globalization is much more similar to the trend at the global level.

3

Figure 1. Global Trends of Globalization as per KOF Indexes (1970-2006)

KOF Index of Globalization

70

60

50

40
1970

1975

1980

1985 Year 1990

Overall globalization
Social globalization

1995

2000

2005

Economic globalization
Political globalization

Source: Author’s calculation using data from Axel Dreher, Does Globalization Affect Growth? Empirical Evidence from a New Index, Applied Economics, Vol. 38, No. 10 (2006).

Figure 2. Asian Trends of Globalization as per KOF Indexes (1970-2006)

KOF Index of Globalization

60

50

40

30

1970

1975

1980

1985

1990

1995

2000

2005

Year

Overall globalization
Social globalization

Economic globalization
Political globalization

Source: Author’s calculation using data from Axel Dreher, Does Globalization Affect Growth? Empirical
Evidence from a New Index, Applied Economics, Vol. 38, No. 10 (2006).

4

Figure 3 shows the country-level trends of globalization in Asia. As a huge continent lacking a clear-cut common definition, Asia in this study includes both East Asia and the Pacificand South Asia.25 Thus, it includes some Pacific countries but excludes Central Asia and Arabregions as these areas are much more integrated with Europe and North Africa than with East andSouth Asia. The study considers all the countries from East Asia and the Pacific and South Asia,
for which all required data are available, but excludes Australia and New Zealand because thesecountries have had nearly the same human development levels as Japan (the benchmark countryof this study) since 1975 (the base year).26 As can be seen in Figure 3, globalization trends are notvery different among Asian countries. However, poorer countries such as Nepal and Bangladesh
appear to be on low levels of globalization. As expected, newly industrialized countries, such asSingapore and the Republic of Korea (South Korea) have higher levels of globalization. Surprisingly, these countries are marked by even higher levels of globalization than Japan, the second
largest economy in the world in terms of real GDP value.
Figure 3. Globalization Trends of Selected Asian Countries (1975-2005)

KOF Index of Globalization

100

80

60

40

20
1975

1980

1985

Year

1990

1995

2000

2005

Bangladesh/Singapore

Cambodia/Sri Lanka

China/Thailand

Fiji/Vietnam

India

Indonesia

Japan

Korea Rep.

Malaysia

Mongolia

Nepal

PakistanPapua NG

Philippines

Samoa

Source: Author’s calculation using data from Axel Dreher, Does Globalization Affect Growth? Empirical
Evidence from a New Index, Applied Economics, Vol. 38, No. 10 (2006).

The main dependent variable of this study is human QOL. Considering the popularity as
well as availability of data, the present study uses the Human Development Index (HDI) developed by the United Nations Development Program (UNDP). Although HDI does not include
all the aspects of human QOL, it broadly summarizes the level of human QOL in a single indicator.27 According to the Human Development Report 2007/08, the HDI involves three key
sub-constructs with corresponding measures: health or longevity (measured by life expectancy
at birth indicators), knowledge or education (measured by adult literacy rates and combined5

enrollment ratios), and an adequate standard of living or income (measured by adjusted per capita
income in dollar purchase power parity terms).28 (See a detailed explanation of the indexes inAppendix II.)

Human Development Index（HDI）

Figure 4. Human Development Trends of World Regions (1975-2005)

9

8

7

6

5

4
1975

1980

1985

Sub Saharan Africa
Latin America & Caribbean

Year

1990

1995

South Asia
OECD

2000

2005

East Asia & PacificWorld

Source: Author’s calculation using data from UNDP, Human Development Reports, various years.

Figure 4 presents the trends of HDI across world regions from 1975 to 2005. The generalobservation is that Sub-Saharan Africa has the lowest HDI, followed by South Asia (SAS). This
fact is consistent with globalization trends. Notably, the East Asia and the Pacific (EAP) region
took a more rapid pace of HDI growth from the beginning of the 1990s and surpassed the global
average around the beginning of the 21st century. This is because of its high and shared economic
growth as per the World Bank.29
To give a detailed picture of HDI trends in the Asia-Pacific region, the trends for each selected country are drawn in Figure 5. The graph shows that all the countries have an increasing
trend of human development over time, though a few countries show some fluctuations and others exhibit steady trends. Interestingly, poor countries have a more rapid growth of HDI. Thisfinding gives a general impression of convergence of human QOL in the region. The next section
demonstrates the trends of convergence more concretely.

6

Human Development Index（HDI）

Figure 5. Human Development Trends of Selected Asian Countries (1975-2005)
10

8

6

4

2
1975

1980

1985

Bangladesh/Singapore
Fiji/Vietnam
Japan
Mongolia
Papua NG

Year

1990

1995

Cambodia/Sri Lanka
India
Korea Rep.
Nepal
Philippines

2000

2005

China/Thailand
Indonesia
Malaysia
Pakistan
Samoa

Source: Author’s calculation using updated data from UNDP, Human Development Report 2007/08.

3. Is Human QOL Converging in Asia?
The mainstream literature on convergence argues that globalization raises the living standard of all participants in the globalization process. Theoretically, increased international traderaises the real incomes of all participating countries. Accessing the superior technology embodied
in goods or capital, or simply through intellectual exchange, allows greater productivity gains inpoorer countries. Similarly, international capital flows bring new technology and allow countries
to tap into a larger savings pool, which helps the poor more. Finally, the free flow of labor force
also contributes to convergence, as people from poor countries migrate to richer nations. A number of empirical papers on convergence support this view. For example, Baumol, and Baumoland Wolff tested for the convergence among industrialized countries over the period of a century
beginning in 1870.30 Other notable papers are on the convergence among OECD countries andamong individual U.S. states,31 among European Community members,32 among European regions,33 among Spanish provinces,34 and so forth. As economic theory suggests, all these papers
have shown income convergence.
However, many other scholars show diverging trends of income and human QOL. For
example, Maddison and Pritchett demonstrated the historical process of income divergence.35
However, they did not fully contradict the mainstream belief of a strong causal link between
globalization and income convergence because a major diversion was created by the discrete
technological breakthroughs of the Industrial Revolution. Also, the income divergence among
countries over the last 20 years was explained by the fact that globalized countries were attempting to reach the same industrial standards, and those who did not globalize were left behind.36
Nevertheless, there are also strong counter-arguments that question the convergence hypothesis7

as the world is becoming more unequal in terms of per capita income. Indeed, looking back overthe last 100 years or so, initially poorer countries have tended to experience lower subsequent
growth rates.37 Poor countries are not catching up with rich ones; rather, it seems the opposite has
been happening. For example, Ravalian showed that the average income of the richest countries
in the world was about 10 times that of the poorest around the end of the nineteenth century but
is closer to 60 times higher today.38 Furthermore, Milanovic argued that inequality between countries increased sharply since the beginning of the 1980s.39
The convergence literature is not very focused on the Asian region. Instead, the focus isgenerally on groups of countries that have similar characteristics, such as OECD countries, European countries, or American states. In addition, the convergence literature concentrates heavily
on the income aspect. Although there are several papers that deal with the convergence of human
QOL,40 most of them tend to use disaggregated factors of QOL, which cannot give an overall
picture of human QOL. For instance, Kenney analyzed the convergence of income, health, andeducation separately for the East Asian countries.41 Ram studied the cross-country inequality ofcalorie supply, life expectancy, and adult literacy, and found that the inequality of these indicators across the world was minimal compared to income inequality.42 Ingram found that there wasstrong evidence of convergence in life expectancy, caloric intake, primary enrollment ratios, andurbanization—fairly strong evidence of convergence.43 All of the studies, however, fail to consider the overall human QOL as a dependent variable, even though the single index of humandevelopment has been available since 1990.
Conventional methodology for testing the convergence hypothesis is also critically questioned. Ravallian pointed out that methodological differences and data type and quality variations
are the main causes of different findings and arguments on convergence.44 More importantly,
Quah theoretically rejected using the so-called sigma, coefficient of variation and beta convergence.45 Sigma convergence is defined as decline over time of the cross-sectional dispersion of avariable, which can be measured by looking at the size of standard deviation. For variables thattrend upward (or downward) across the world over time, it is argued, the coefficient of variation(standard deviation divided by the mean) might provide a better reflection of convergence or divergence. A third conventional approach is the beta convergence, which is used frequently in theliterature on cross-country economic growth. Beta convergence is defined if the variable displays
mean reversion, meaning that the value of a variable at the start is inversely correlated with its
growth over that period. Quah’s point is valid as he showed how results were misleading becauseof the famous Galton’s fallacy of regression towards the mean.46 Thus, as Quah suggests, thisstudy follows an alternative method, which is more transparent about whether convergence occurs or does not occur. However, the study does not take Quah’s model as it is; instead, it follows
his wisdom.
First, this study directly calculates the human QOL indicator gap between each country andthe benchmark country over time. As the most developed country in Asia, the study takes Japanas the benchmark country to calculate the human QOL gaps, which are also taken as the dependent variables for regression analysis. Symbolically, the human QOL gaps between Japan andeach country are calculated using simple mathematics as follows:∆γct = γjt ― γct ............................................................................................................... (1)where, ∆γct is the difference in a particular human QOL indicator between Japan and country c atyear t; γjt is Japan’s human QOL indicator at year t; and γct is country c’s human QOL indicator attime t.
The calculated human QOL indicator gaps between Japan and each country for each fiveyear interval are plotted as lines-graphs to observe convergence (or divergence). First, the HDI
8

gaps are calculated as the overall measure of human QOL and then the gaps in individual elements of HDI are assessed. As can be seen in Figure 6, most of the countries are catching up withJapan in terms of human development. The trend line for Japan is constant with 0 value because
the line represents the difference of HDI value with Japan itself. For almost all other countries,
trend lines of this HDI gap are sloping downward, meaning that the gap with Japan is closing.
Clearly, human QOL in Asia is converging.

HDI difference between Japan and the respective country

Figure 6. Trends of HDI-Gaps of Asian Countries with Japan (1975-2005)
6

4

2

0
1975

1980

1985

1990

1995

2000

2005

Year

Bangladesh/Singapore
Fiji/Vietnam
Japan
Mongolia
Papua NG

Cambodia/Sri Lanka
India
Korea Rep.
Nepal
Philippines

China/Thailand
Indonesia
Malaysia
Pakistan
Samoa

Source: Author’s calculation using data from UNDP, Human Development Reports, various years.

If we see the trends of each individual country, the pace of catching up is rapid for many
countries. For instance, Singapore and South Korea are catching up quickly and nearly reaching
the full convergence stage with Japan. This can be explained by their very high level of globalization (see Figure 3 for respective globalization trends). Similarly, countries with a higher initial
gap also tend to have a rapid pace of catching up. Nepal and Bangladesh fall in this category.
However, in spite of having a higher initial HDI gap, Cambodia and Papua New Guinea are slow
to catch up. On the other hand, the Philippines and Samoa also have very slow trends, despite
having relatively low initial HDI gaps with Japan. Thus, based on this analysis, we can conclude
that the Asian-Pacific countries are converging in terms of HDI.
The remaining part of this section presents the convergence (or divergence) of individualcomponents of HDI. Although there is a clear convergence of HDI, some of the individual
variables are converging and some are not. For example, the health indicator, measured by life
expectancy at birth, is converging as shown in Figure 7. Similarly, one of the major education indicators used to construct HDI, adult literacy, is also found converging (Figure 8). As in the caseof HDI, the speed of convergence is higher for some countries, such as Nepal, Bangladesh, andVietnam. On the contrary, another indicator of education, gross school enrollment from primary
9

to tertiary level, is neither converging nor diverging (Figure 9). Some countries, such as Singapore, the Philippines, Bangladesh, and Nepal, were able to narrow their gaps with Japan, whereas
gaps grew for Papua New Guinea, Cambodia, and Mongolia, among others. Interestingly, South
Korea fully converged with Japan around 1992 and crossed over the benchmark in terms of grossschool enrollments.

Llife expentancy at birth-gap with Japan

Figure 7. Trends of the “Life Expectancy at Birth”-Gaps with Japan (1975-2005)
40

30

20

10

0
1975

1980

1985

1990

1995

2000

2005

Year

Bangladesh/Singapore
Fiji/Vietnam
Japan
Mongolia
Papua NG

Cambodia/Sri Lanka
India
Korea Rep.
Nepal
Philippines

China/Thailand
Indonesia
Malaysia
Pakistan
Samoa

Source: Author’s calculation using data from UNDP, Human Development Reports, various years.

Supporting the existing literature, Figure 10 shows that the income aspect of human QOL
is diverging in Asia. The gap between the benchmark country Japan and the other countries isincreasing sharply. Exceptionally, Singapore converged with Japan around 1992, and the rapid
growth continued so that the gap increased sharply, leaving Japan far behind. Overall, the gap
was raised sharply during the period of 1980-1990. Since then, the gap increased continuously
for all the countries except South Korea.
Based on this simple and transparent assessment, the overall measure of human QOL in termsof HDI in Asia was found to be converging. The health aspect of QOL was also converging, but theeducation aspects of QOL showed mixed results, with adult literacy converging and gross school
enrollment neither converging nor diverging. On the contrary, the income aspect of human QOL
measured by GDP per capita was sharply diverging.
The following section assesses the impact of globalization on these convergence and divergencetrends, which is the main question of interest in the present study.

10Adult literacy-gap with Japan

Figure 8. Trends of the “Adult Literacy”-Gaps with Japan (1975-2005)
80
60
40
20
0
1975

1980

1985

1990

1995

2000

2005

Year

Bangladesh/Singapore
Fiji/Vietnam
Japan
Mongolia
Papua NG

Cambodia/Sri Lanka
India
Korea Rep.
Nepal
Philippines

China/Thailand
Indonesia
Malaysia
Pakistan
Samoa

Source: Author’s calculation using data from various Human Development Reports by UNDP

Gross school enrollment-gap with Japan

Figure 9. Trends of the “Gross School Enrollment”-Gaps with Japan (1975-2005)
60

40

20

0

-20
1975

1980

1985

1990

1995

2000

Bangladesh/Singapore
Fiji/Vietnam
Japan
Mongolia
Papua NG

Cambodia/Sri Lanka
India
Korea Rep.
Nepal
Philippines

China/Thailand
Indonesia
Malaysia
Pakistan
Samoa

Source: Author’s calculation using data from UNDP, Human Development Reports, various years.

11

2005

Year

Figure 10. Trends of the “GDP Per Capita”-Gaps with Japan (1975-2005)
30000

20000

10000

0

GDP per capita-gap
with Japan（USS）-10000
1975

1980

1985

1990

1995

2000

2005

Year

Bangladesh/Singapore
Fiji/Vietnam
Japan
Mongolia
Papua NG

Cambodia/Sri Lanka
India
Korea Rep.
Nepal
Philippines

China/Thailand
Indonesia
Malaysia
Pakistan
Samoa

Source: Author’s calculation using the World Development Indicators online database of the World Bank (accessed August 27, 2009)

4. Has Globalization Affected Human QOL Convergence?
This section addresses the main question of this study. It estimates combined cross-section
time-series regressions using the human QOL-gaps of each country with Japan for each period(as reported in the previous section) as the dependent variables. These variables are calculatedusing the HDI values and the individual components of HDI as reported in the UNDP’s Human
Development Reports, which are publicly available on the UNDP home page. HDI is based on
the achievement of three basic aspects of human QOL: health, education and income. A detailed
explanation of HDI and its components is presented in Appendix II. All data are taken over fiveyear intervals from 1975 to 2005. Similarly, the KOF Index of Globalization is the main explanatory variable, which is taken from Dreher, 2006. A detailed explanation of the KOF Index isgiven in Appendix I.
As some data are not available for all countries in the region, only 19 countries have been
selected, and the panel is strongly balanced, meaning that most of the data are available for theselected countries for all the periods. However, as the value of all dependent variables (human
QOL-gap) for Japan is 0 over the period, Japan is excluded from the regression analysis.
The regression estimation model is as follows:y it = α + β y it − 1 + γ ' G it + η ' C it + + η i + η t + ε it ............... (2)where y represents the difference between the human QOL-gaps between Japan and the specificcounty (i) in specific time (t), yit-1 is the lagged dependent variable, G represents the measures of12

globalization (negative and positive coefficient of G explains the convergence and divergence effect respectively), C represents the vector of control variables, ηi is the country fixed effect, ηt is
the period fixed effect, and ε is an error term.
The lagged dependent variable is included because HDI-inequality tends to change slowly
over time. However, it creates several serious methodological problems. Given the inclusion of
the lagged dependent variable and fixed country effects, the OLS estimator is biased and inconsistent in short panels.47 To deal with this problem, the analysis uses the system GMM (generalized
method of moments) estimator, as suggested by Arellano and Bover, and Blundell and Bond.48
Results are based on the one-step estimator implemented by Roodman, which is explained in detail by Roodman in Stata,49 including Windmeijer’s finite sample correction.50
In choosing the set of control variables, the study follows standard practice as much as
possible. All the control variables and their precise definitions and data sources are listed in Appendix III. First, it includes GDP per capita at the initial point of each 5 year-period to capture
the effect of the initial level of development on convergence. It also includes the share of theunder-15 year-olds and the over-64 year-olds relative to the total population (referred to as theage-dependency ratio ). This ratio controls for demographic factors and is expected to vary
positively with the HDI gap with richer countries. Similarly, overall and urban population growth
rates are taken as they affect human QOL significantly. It is expected that the overall population
growth rate correlates positively and urban population growth rates negatively to the QOL-gaps.
Similarly, irrigated land in percent of total cropland, electricity consumption per capita, andannual growth rate of manufacturing sector value added are also included as control variables.
Irrigated land captures the effect of agricultural infrastructure, which is assumed to be an important factor to uplift millions of poor that mostly depend on subsistent agriculture. Electricity consumption per capita is expected to affect human QOL positively as it is one of the key elements
to make human life easier and more efficient. Manufacturing value added is one of the mainindicators of industrialization, which is supposed to be crucial in improving people’s lives by creating employment and producing cheaper goods. The data on these variables are taken from the
WDI online database of the World Bank.
Finally, democracy indicator is used to gauge the effect of political as well as social liberty
on human QOL and is expected to have a converging impact on human QOL. Indeed, there isa positive relationship between democracy and human QOL.51 The measures of democracy aretaken from Freedom House and are available for 1972-2008.52 The democracy index consists of
two key rights. Firstly, the political rights measure is a subjective indicator that annually rankseach country on a scale from one (the highest level of political rights) to seven (the lowest level).
Secondly, the civil liberties measure is used to capture personal rights such as those to free expression and to organize or demonstrate and is placed on the same scale from one to seven. These
two Freedom House measures of democracy are averaged and normalized to range from 0 to 100,with 100 representing full democracy.
The time dummies are included in the equation and it is revealed that time and country fixed
effects are jointly significant but the results are omitted from the result tables. The variables arelogged if they have absolute values. The percentage form and index numbers are not logged. The
descriptive statistics and the correlation matrix are reported in Appendix IV and Appendix V, respectively.
Tables 1 to 5 report the results, each table for each dependent variable. In Column [1], results come from regressing all the three indexes of globalization (economic, social, and political) including the control and lag dependent variables. In Column [2], a single index of overall
globalization is regressed instead of three separate indexes. The magnitude and the sign of thecoefficients explain the strength and the direction of the effect of regressors, respectively. Thus,
the negative sign of a coefficient means convergence effect and vice versa. The three, two, and13

one asterisks (***, **, and *) denote the significance of the coefficients at 1%, 5%, and 10%,respectively. The standard errors are reported in parentheses.
In Table 1, the dependent variable is HDI, which measures the overall human QOL. The
results show that the HDI gap narrows with globalization, with the coefficient being significant
at 1% level for economic, social as well as overall globalization and just at 10% for politicalglobalization. This confirms that globalization helps to increase the human QOL more in poorer
countries than in richer ones, resulting in HDI convergence. This result is consistent with thetheoretical arguments by Sirgy et al. and the empirical findings by Tsai on the positive impacts ofglobalization on human QOL.53

Table 1: Globalization and Human Development Gaps (1975-2005)

Dependent variable: HDI-gap with Japan (∆ HDIct﹦ HDIjt - HDIct)[1]
Lagged dependent variable (∆ HDIt-1)[2]
droppeddropped

0.2 *** (0.056)

0.278 *** (0.097)---0.031*** (0.009)

Economic globalization index-0.005*** (0.002)--

Social globalization index-0.014*** (0.003)--

Political globalization index-0.002* (0.001)--

0.119*** (0.049)

0.174** (0.076)

Urban-population growth rate

-0.004 (0.009)-0.004 (0.076)

Age dependency ratio-0.002 (0.002)-0.002 (0.003)

Irrigated land (% of cropland)-0.002* (0.001)-0.004* (0.002)

Manufacturing value-added (annual growth rate)-0.001 (0.002)-0.001 (0.002)

Log of electricity consumption (kWh per capita)-0.016 (0.02)-0.004 (0.03)

Democracy index-0.001 (0.001)-0.002* (0.001)

droppeddropped53

53

Log of GDP per capita
Globalization: Overall globalization index

Population growth rate

Constant
Number of observations

Notes: Dynamic panel one step system GMM estimations are reported. Standard errors are in parentheses. ***,**, and* denote the significance of the coefficients at 1%, 5%, and 10%, respectively.
Sources: Globalization data are taken from Dreher (2006) (http://globalization.kof.ethz.ch/); GDP per capita(current US$), population growth rate, urban-population growth rate, age dependency ratio, irrigatedland, manufacturing sector value-added, and electricity consumption per capita are taken fromthe World Development Indicators (WDI) online database of the World Bank; democracy index is
calculated from the data of the Freedom House website (http://www.freedomhouse.org/); and humandevelopment index (HDI) is taken from UNDP, Human Development Report (updated online version
of HDR 2007/08). The data cover the period from 1975 to 2005 in 5-year intervals.

14

The impacts of the control variables are mixed and consistent for both columns. The lag
dependent variable is dropped due to a high degree of collinearity with the dependent variable.
Unexpectedly, the HDI gap with Japan rises with higher GDP per capita and the coefficient issignificant at 1%. This correlation might be explained by the increasing income inequality as
shown in Figure 10. Other results are as expected. Population growth has a diverging effect onhuman QOL with the coefficients significant at 1% and 5% level for Column [1] and Column[2], respectively. As expected, the population growth and age dependency ratio are found to havediverging effects on human QOL. The effects are statistically significant at the 1% level. This assessment shows the importance of controlling the demography of the country to improve human
QOL.
On the contrary, although the significance level is weak (at 10%), irrigated land and democracy index have converging effects on QOL. This relationship indicates that the agricultural infrastructure is important in reducing the QOL-gap as most of the poorer countries, and their poor
households, are highly dependent on agriculture. If the governments of poor countries cannot
provide alternative employment through industrialization, the improvement of the agricultural
sector is required to uplift the quality of life of their people. Similarly, democracy provides anopportunity for people to control their own futures and hopefully improve their quality of life.
Indeed, no one can make a better decision than the people themselves about their lives. Democracy’s significant impact on the converging process of human QOL further reconfirms both thetheories and empirics that suggest democracy as one of the vital factors in improving the life ofpoor people in any country.

Table 2: Globalization and “Life Expectancy at Birth”-Gaps (1975-2005)

Dependent variable: Log of life expectancy at birth -gap with Japan (∆ lifexpct﹦ lifexpjt - lifexpct)[1]
Lagged dependent variable (∆ lifexpt-1)[2]
droppeddropped0. 896*** (0.201)

0. 643 *** (0.19)---0.029*** (0.011)

Economic globalization index-0.014** (0.007)--

Social globalization index-0.058*** (0.012)---0.005 (0.005)--

Population growth rate

0.209 (0.174)-0.11 (0.157)

Urban-population growth rate

0.019 (0.033)

0.071* (0.04)

Age dependency ratio-0.002 (0.008)

0.011 (0.008)-0.011** (0.005)-0.001 (0.004)

Manufacturing value-added (annual growth rate)-0.005 (0.006)-0.001 (0.008)

Log of electricity consumption (kWh per capita)-0.087 (0.072)-0.284*** (0.101)

Democracy index-0.002 (0.003)-0.000 (0.003)

droppeddropped53

53

Log of GDP per capita
Globalization: Overall globalization index

Political globalization index

Irrigated land (% of cropland)

Constant
Number of observations

Notes: Dynamic panel one step system GMM estimations are reported. Standard errors are in parentheses. ***,**, and* denote the significance of the coefficients at 1%, 5%, and 10%, respectively.
Sources: See Table 1.

15

Disaggregated analyses of the human QOL are presented in Table 2 to Table 5. Each variable̶health, education, and income̶is a dependent variable in each table. These analyses not
only testify to the impact of globalization on each aspect of human QOL, but also check the validity of the methodology that is applied in this study. In Table 2, log of life expectancy at birthis taken as a dependent variable. As in Table 1, a lag dependent variable is dropped for bothcolumns. The impact of overall and social globalization on the convergence of life expectancy atbirth has been found to be significant at 1%, whereas economic globalization is significant at 5%.
Political globalization has no significant effect on the convergence process.
The control variables have mixed impacts. As in Table 1, GDP per capita has a diverging
effect at 1% level for both columns. Irrigated land has been found to have a significant converging
effect at 5% in Column [1], and the urban-population growth and electricity consumption are
also significant in reducing the gap at 10% and 1% in Column [2]. The effects of the remaining
control variables are not significant. However, the overall results are consistent with the case of
HDI in Table 1.

Table 3: Globalization and “Adult Literacy”-Gap (1975-2005)

Dependent variable: Log of adult literacy -gap with Japan (∆ adultlrct﹦ adultlrjt - adultlrct)[1]
Lagged dependent variable (∆ adultlrt-1)[2]
droppeddropped0. 916*** (0.381)

1. 488** (0.644)---0.113** (0.05)-0.04*** (0.015)---0.035 (0.023)---0.023*** (0.008)--

0.977*** (0.349)

1.93*** (0.667)

Urban-population growth rate

-0.018 (0.089)-0.017 (0.129)

Age dependency ratio-0.011 (0.02)-0.011 (0.029)

Irrigated land (% of cropland)-0.008 (0.009)

0.013 (0.014)

Manufacturing value-added (annual growth rate)

0.014 (0.017)

0.022 (0.023)

Log of electricity consumption (kWh per capita)-0.436** (0.209)-0.547** (0.283)

Democracy index-0.019*** (0.007)-0.018** (0.01)

droppeddropped53

53

Log of GDP per capita
Globalization: Overall globalization index
Economic globalization index
Social globalization index
Political globalization index
Population growth rate

Constant
Number of observations

Notes: Dynamic panel one step system GMM estimations are reported. Standard errors are in parentheses. ***,**, and* denote the significance of the coefficients at 1%, 5%, and 10%, respectively.
Sources: See Table 1.

16

Table 3 reports the impact of globalization on adult literacy gaps. The main results are consistent with the previous two tables. Globalization has a converging effect with high degree ofsignificance. The main difference is that political globalization is significant to reduce the literacy
gap at 1%, and social globalization is not significant. This can be attributed to the fact that the elements of political globalization, such as international non-governmental organizations (INGOs),
multilateral organizations as well as bilateral donor agencies, are playing significant roles in education, particularly with respect to informal education compared to the role of national governments.
As for the control variables, GDP per capita and population growth have highly significant
diverging effects, as expected. Electricity consumption is found to be significant in reducing theliteracy gaps at 5% for both columns. In fact, access to electricity, particularly in rural areas,
greatly improves the study environment for students.
In the case of democracy, the result reconfirms the findings of Frey and Al-Roumias; democracy index is significant in reducing the adult literacy gap at 1% in Column [1] and 5% inColumn [2]. The effects of the remaining control variables are not significant. These results arealso highly consistent with the case of HDI in Table 1.

Table 4: Globalization and “Gross School Enrollment”-Gaps (1975-2005)

Dependent variable: Log of gross school enrollment -gap with Japan(∆ enrollct﹦ enrolljt - genrollct)[1]
Lagged dependent variable (∆ genrollt-1)[2]

01.116*** (0.297)

1.343*** (0.354)

0.000 (0.000)

0.000 (0.000)---0.043 (0.029)-0.037* (0.019)--

Social globalization index

0.033 (0.025)--

Political globalization index-0.001 (0.006)--

droppeddroppedUrban-population growth rate

-0.055 (0.06)-0.093 (0.074)

Age dependency ratio

0.014 (0.009)

0.01 (0.01)-0.013* (0.007)-0.004 (0.005)

Manufacturing value-added (annual growth rate)

0.002 (0.009)-0.003 (0.01)

Log of electricity consumption (kWh per capita)

droppeddropped-0.01 (0.006)-0.006 (0.005)

droppeddropped49

49

Log of GDP per capita
Globalization: Overall globalization index
Economic globalization index

Population growth rate

Irrigated land (% of cropland)

Democracy index
Constant
Number of observations

Notes: Dynamic panel one step system GMM estimations are reported. Standard errors are in parentheses. ***,**, and* denote the significance of the coefficients at 1%, 5%, and 10%, respectively.
Sources: See Table 1.

17

The dependent variable for Table 4 is gross school enrollment—another education-related
indicator—used to construct HDI. Gross school enrollment is the combined enrollment from primary to tertiary level education. In this case, lag dependent variable is significant in increasing
the gap at 1% level for both columns. However, GDP per capita is not significant.
Surprisingly, only economic globalization is found to have a converging effect at 10% level.
The other kinds of globalization and overall globalization are insignificant. Control variables arealso found not to be significant save for irrigated land, which has a significant converging effectat 10% level, but only in Column 1. These results indicate that school enrollment is affected moreby the domestic policies rather than globalization. Further analysis is essential to explore thisissue.
The result for this particular dependent variable is different from that of previous dependent
variables; in fact, gross school enrollment has been found neither converging nor diverging (Figure
9).
However, it is interesting to find the significant converging effect of democracy on school
enrollment. This result is consistent with the findings of Brown, who empirically showed thepositive impact of democracy on primary school enrollment.54

Table 5: Globalization and “GDP Per Capita”-Gap (1975-2005)

Dependent variable: Log of GDP per capita gap with Japan(∆ gdppcpct﹦ gdppcpjt - gdppcpct)

Lagged dependent variable (∆ gdppcpt-1)
Globalization: Overall globalization index

[1]

[2]

1.022*** (0.009)

1.028*** (0.009)---0.001 (0.001)

Economic globalization index

0.001 (0.001)--

Social globalization index-0.001 (0.001)--

Political globalization index

0.001* (0.001)---0.004 (0.019)

0.007 (0.019)-0.008** (0.004)-0.007** (0.004)

0.001 (0.001)

0.001 (0.001)

Irrigated land (% of cropland)-0.001** (0.001)-0.001*** (0.001)

Manufacturing value-added (annual growth rate)-0.002*** (0.001)-0.002*** (0.001)

Log of electricity consumption (kWh per capita)

0.009 (0.008)

0.005 (0.009)

Democracy index-0.001** (0)-0.001*** (0)droppeddropped

53

53

Population growth rate
Urban-population growth rate
Age dependency ratio

Constant
Number of observations

Notes: Dynamic panel one step system GMM estimations are reported. Standard errors are in parentheses. ***,**, and* denote the significance of the coefficients at 1%, 5%, and 10%, respectively.
Sources: See Table 1.

18

Finally, Table 5 presents the results for GDP per capita, the income measure of human QOL,
as a dependent variable. As in Table 4, the lag dependent variable is significant at the 1% levelin increasing the income gap. This means that the initial level of GDP per capita is a very goodpredictor of future income levels. This phenomenon leads to income divergence. In fact, a clear
divergence is found by this study (see Figure 10 in the previous section).
However, globalization has no significant impact on the rising income gap in Asia. The
result shows that only political globalization has a diverging effect at the 10% level. This isconsistent with many existing studies, which claim that although the world income inequality
is rising sharply, it is not the effect of globalization that is changing it; instead, it is the lack ofglobalization in poorer countries.55
The impact of control variables, however, is quite interesting. As expected, urban population
growth has a significant convergence impact on GDP per capita at the 5% level for both columns.
Indeed, urbanization leads to better living conditions, offering better facilities and opportunities
compared to rural areas. Irrigated land and manufacturing sector value-added are also highly
significant in reducing income gaps in both cases. Expanding irrigated land generates higher agricultural productivity and increasing the share of manufacturing value-added to GDP enhances
technological advancement, industrial productivity and also generates more employment in poorer countries, which ultimately leads to reduced income gaps. Finally, as the existing literaturesuggests,56 democracy is highly significant in reducing income gaps. It is significant at the 5%
and 1% levels for Column [1] and Column [2], respectively.
Overall, although the converging effect of globalization is found insignificant for grossschool enrollment and GDP per capita, the effects are highly significant for the other variables.
More importantly, the effect is highly significant in reducing the overall human QOL convergence in terms of HDI. Although the income inequality is rising, the growing level of globalization helps to reduce the gap in the overall quality of life for the people of Asia.

5. Conclusion
In the context of contradicting arguments on the convergence hypothesis, the results of thisstudy reveal that globalization has significantly reduced the gap between the rich country Japanand the rest of the selected Asian and some Pacific countries in terms of human QOL. The resultsreconfirm the convergence hypothesis as far as the human development index and the health andeducation indicators are concerned. The results are also supported by Sab and Smith’s findings
about education and health convergence from 1970 to 1996.57 Even though GDP per capita isfound diverging, globalization does not have a significant effect on this diverging trend. Instead,most of the control variables are found to have converging effects. Thus, what are the factors thatare playing a vital role in income divergence? Further analysis is needed to explore this issue.
Similarly, in spite of the sharply diverging trend of GDP per capita, there is a visible convergence of HDI. It is more dichotomous when considering the literature on the relationship ofincome with health and education. However, the economic theory of diminishing marginal returnof the health and education expenditure explains this dichotomy. Furthermore, even if poorer
countries gain less income than richer ones, they can improve their people’s health and educationlevel at a faster pace.
It is more important to find the significant impact, as we did in this study, of globalizationon this convergence process because many politicians, policymakers, social organizations, activists, and some academics criticize globalization for increasing income inequality. Of course,
income is one of the leading measures of human QOL, but health and education are also equally,
19and sometimes more, important. Income is just a means of life, but arguably, health and education are ends or goals in life. Therefore, it is argued here that convergence in human QOL mattersmore than convergence in income.
Furthermore, in the context of growing discussion as well as initiatives for Asian regional
integration and debate on regionalism versus globalization, the findings of this study support theview that globalization accelerates regional integration by reducing the human QOL gap between
the rich and poor countries in the region. Intuitively, the high level of developmental gap is one of
the main obstacles for regional integration in Asia. Thus, anything that is converging has a favorable impact on the regional integration process.
What are the policy implications of these findings? Clearly, both rich and poor countries
should promote globalization. In view of the questions being raised about the effectiveness ofdevelopment aid,58 and the clear findings of the converging effect of globalization, rather thanproviding more aid, richer countries should be more open towards poorer countries, particularly
the low-income countries.
This study is not enough to offer specific policy recommendations, and to do so the author
calls for a study of some country cases; more specifically, for an assessment of the impact of globalization on human QOL convergence within countries. Such studies will facilitate the development of policy recommendations tailored towards countries in their own cultural contexts for the
purpose of promoting their globalization with a positive (or at least neutral) impact on the reduction of human QOL gaps within them.

Notes
The preliminary version of this paper was presented at the Summer Institute on Regional Integration
2009, organized by the Global Institute for Asian Regional Integration (GIARI), Waseda University.
The author is highly indebted to the professors and participants whose comments and suggestions during and after the presentation have been instrumental in writing and refining this article. Sincere thanks
go to Prof. Shujiro Urata, Prof. Shunji Matsuoka, Prof. Tsuneo Akaha, Prof. Vinod K. Aggarwal, Prof.
Kazuhiko Yokota, Prof. Kyosuke Kurita, Dr. Giovanni Capannelli, Dr. Stephen R. Nagy, and also to theanonymous referees for thorough comments. The author also thanks Ms. Sonia Aggarwal, an intern at
GIARI, for proofreading and English editing. Finally, wholehearted thanks go to the Waseda University
Global COE Program, GIARI, and its Program Leader Prof. Satoshi Amako for the generous funding
and encouragement for conducting this research project.
2 Shujiro Urata, Globalization and the Growth in Free Trade Agreements, Asia-Pacific Review, Vol. 9,
No. 1 (2002), pp. 20-32; Axel Dreher, Neol Gaston, and Pim Martens, Measuring Globalization - Gauging Its Consequence, New York: Springer, 2008.
3 Dennis A. Rondinelli and John M. Heffron, Adjusting to Globalization: Change and Transformationin Asia, in D.A. Rondinelli and J. M. Heffron, eds., Globalization and Change in Asia, Boulder, Colorado: Lynne Rienner, 2007, pp. 1-13.
4 Branko Milanovic, Worlds Apart: Global and International Inequality, 1950–2000, Princeton, NJ:
Princeton University Press, 2005.
5 World Bank, The East Asian Miracle: Economic Growth and Public Policy, Washington, D.C.: World
Bank, 1993.
6 After the publication of East Asian Miracle by the World Bank in 1993, the phrase became one of thebest known in development studies. It is because of the region’s fast growth in the past three decades.
The economies of Japan and the Newly Industrializing Economies (NIEs) of Hong Kong, Singapore,
Korea, and Taiwan are still considered models of development for other countries. For details, see Shahid Yusuf, The East Asian Miracle at the Millennium, in Joseph E. Stiglitz, and Shahid Yusuf, eds.,
Rethinking the East Asian Miracle, Oxford University Press, 2001, pp. 1-39.
7 Geoffrey Garrett, The Causes of Globalization, Comparative Political Studies, Vol. 33, No. 6-7(2000), pp. 941-991; Emmanuel Nyahoho, Globalization and Economic Goals, The Journal of Social,
Political, and Economic Studies, Vol. 26 (2001), pp. 543-568; Axel Dreher, Does Globalization Af1

20fect Growth? Empirical Evidence from a New Index, Applied Economics, Vol. 38, No. 10 (2006), pp.
1091-1110.
8 Joseph E. Stiglitz, Making Globalization Work, New York: W.W. Norton, 2006, pp. xxvi and 358; Amartya Sen, A Decade of Human Development, Journal of Human Development and Capabilities: A
Multi-Disciplinary Journal for People-Centered Development, Vol. 1, No. 1 (2000), pp. 17-23.
9 Charles Kenny, There’s More to Life Than Money: Exploring the Levels/Growth Paradox in Incomeand Health, Journal of International Development, Vol. 21, No. 1 (2009), pp. 24-41.
10 Charles Kenny, What’s Not Converging? East Asia’s Relative Performance in Income, Health, and
Education, Asian Economic Policy Review, Vol. 3 (2008), pp. 19-37.
11 John Beynon and David Dunkerley, eds., Globalization: The Reader, New York: Routledge, 2000;
Emma Bircham and John Charlton, eds., Anti Capitalism: A Guide to the Movement, London: Bookmarks, 2001; Department for International Development (DFID), Making Globalization Work for the
Poor, DFID White Paper, London: HMSO, 2000; Kevin Watkins and Penny Fowler, Rigged Rules andDouble Standards: Trade, Globalization and The Fight Against Poverty, Oxford: Oxfam publishing,
2002.
12 Howard J. Wiarda, ed., Globalization: Universal Trends, Regional Variations, Lebanon, NH: University
Press of New England, 2007.
13 According to Luke Martell, some recent contributions to globalization literature have identified threewaves or perspectives in globalization theory—the globalists, skeptics, and transformationalists or
postskeptics. For detail, see Luke Martel, The Third Wave in Globalization Theory, The International
Studies Review, Vol. 9, No. 2 (2007), pp. 173-196.
14 Dreher, op. cit.
15 Friedrich Heinemann, Does Globalization Restrict Budgetary Autonomy? A Multidimensional Approach, Intereconomics, Vol. 35 (2000), pp. 288-298.
16 Roland Vaubel, Enforcing Competition among Governments: Theory and Application to the European
Union, Constitutional Political Economy, Vol. 10 (1999), pp. 327-338.
17 Dani Rodrik, Who Needs Capital Account Convertibility? in Stanley Fischer et al, eds., Should the
IMF Pursue Capital Account Convertibility?, Princeton, NJ: Department of Economics, Princeton University, 1998, pp. 55-65.
18 David Dollar and Aart Kraay, Trade, Growth, and Poverty, The Economic Journal, Vol. 114, No. 493(2004), pp. F22 - F49; Hali J. Edison, Ross Levine, Luca Ricci, and Torsten Slok, International Financial Integration and Economic Growth, IMF Working Paper 02/145, Washington, D.C.: IMF, 2002;
David Greenaway, Wyn Morgan, and Peter Wright, Exports, Export Composition, and Growth, Journal of International Trade and Economic Development, Vol. 8 (1999), pp. 41-51.
19 Dreher, p. 1092.
20 Ibid.
21 Foreign Policy Magazine, Globalization Index, http://www.foreignpolicy.com (accessed July 22, 2009).
22 Robert O. Keohane and Joseph S. Nye Jr., Governance in a Globalizing World: Introduction, in
Joseph. E. Nye and John D. Donahue, eds., Governance in a Globalizing World, Washington, D.C.:
Brookings Institution, 2000, pp. 1-44.
23 Dreher, p. 1092.
24 For details see Dreher; and James Gwartney and Robert Lawson, Economic Freedom of the World: Annual Reports, Vancouver: The Fraser Institute, 2001 and 2002.
25 The regions are based on the World Bank classification of countries and regions.
26 Japan is taken as the benchmark country because it is the pioneer of industrialization in Asia and has
had the highest HDI values since the base year 1975. The data required for the study are available fromthe base year, 1975.
27 Sen, op. cit.
28 UNDP, Human Development Report 2007/08, New York: Oxford University Press, 2008.
29 World Bank, Globalization, Growth, and Poverty: A Review of International Evidence, Washington,
D.C.: World Bank, 2002.
30 William J. Baumol, Productivity Growth, Convergence, and Welfare: What the Long-Run Data
Show, American Economic Review, Vol. 76 (1986), pp. 1072-1085; William J. Baumol and Edward N.
Wolff, Productivity Growth, Convergence, and Welfare: Reply, American Economic Review, Vol. 78(1998), pp. 1155-1159.

21

Robert J. Barro and Xavier Sala-i-Martin, Convergence, Journal of Political Economy, Vol. 100(1992), pp. 223-251.
32 Dan Ben-David, Equalizing Exchange: Trade Liberalization and Income Convergence, Quarterly
Journal of Economics, Vol. 108 (1993), p. 3.
33 Edmund S. Cannon and Nigel W. Duck, Galton’s Fallacy and Economic Convergence, Oxford Economic Papers, Vol. 52 (2000), pp. 415-419.
34 Francisco J. Goerlich and Matilde Mas, Inequality in Spain, 1973-91: Contribution to a Regional Database, Review of Income and Wealth, Vol. 47 (2001), p. 3.
35 Angus Maddison, Monitoring the World Economy 1820-1992, Paris: OECD, 1995; Angus Maddison,
The World Economy: Historical Statistics, Paris: OECD Development Studies Centre, 2003; Lant
Pritchett, Divergence, Big Time, Journal of Economic Perspectives, Vol. 11, No. 3 (1997), pp. 3-17.
36 Branko Milanovic, Worlds Apart: Global and International Inequality, 1950-2000, Princeton, NJ:
Princeton University Press, 2005; World Bank, Ravi Kanbur, and Nora Lustig, Why Is Inequality Backon the Agenda? Washington, D.C.: World Bank, 1999, available at http://www.iadb.org/sds/publication/
publication_671_e.htm (accessed July 22, 2009).
37 Pritchett, p. 3.
38 Martin Ravallion, Growth, Inequality and Poverty: Looking Beyond Averages, World Development,
Vol. 29, No. 11 (2001), pp. 1803-1815.
39 Milanovic, pp. 1-240.
40 Charles Kenny, Why Are We Worried About Income? Nearly Everything That Matters is Converging,
World Development, Vol. 33, No. 1 (2005), pp. 1-19; Sadegh Bakhtiari, Globalization and Education:
Challenges and Opportunities, International Business and Economics Research Journal, Vol. 5 (2006),
p. 2; Gregory K. Ingram, Social Indicators and Productivity Convergence in Developing Countries, in
William J. Baumol, Richard R. Nelson, and Edward N. Wolff, eds., Convergence of Productivity: CrossNational Studies and Historical Evidence, Oxford: Oxford University Press, 1994, pp. 316-333; Rati
Ram, Intercountry Inequalities in Income and Basic Needs Indicators: A Recent Perspective, World
Development, Vol. 20, No. 6 (1992), pp. 899-905.
41 Kenny, see note 9.
42 Ram, pp. 899-905.
43 Ingram, pp. 316-333.
44 Martin Ravallian, Competing Concepts of Inequality in the Globalization Debate, World Bank Policy
Research Working Paper 3243, Washington, D.C.: World Bank, 2004.
45 Danny Quah, Galton’s Fallacy and Test of the Convergence Hypothesis, The Scandinavian Journal of
Economics, Vol. 95, No. 4 (1993), pp. 427-443, http://econ.lse.ac.uk/staff/dquah/p/dp-93galfall.pdf (accessed July 22, 2009).
46 In fact, many phenomena tend to be attributed to the wrong causes when regression to the mean is nottaken into account. Indeed, the conclusion of Galton’s (1886) famous work, which actually gave thepopularity of regression analysis itself, was wrong as he failed to understand the nature of regression
towards the mean.
47 Stephen J. Nickell, Biases in Dynamic Models with Fixed Effects, Econometrica, Vol. 49 (1981), pp.
1417-1426.
48 Manuel Arellano and Olympia Bover, Another Look at the Instrumental Variable Estimation of Error
Components Models, Journal of Econometrics, Vol. 68, No. 1 (1995), pp. 29-51; Richard Blundell andStephen Bond, Initial Conditions and Moment Restrictions in Dynamic Panel Data Models, Journalof Econometrics, Vol. 87, No. 1 (1998), pp. 115-143.
49 David Roodman, xtabond2: Stata Module to Extend xtabond Dynamic Panel Data Estimator, Center
for Global Development, Washington, D.C., 2005, http://econpapers.repec.org/software/ bocbocode/s435901.htm (accessed July 22, 2009); David Roodman, How to Do xtabond2: An Introduction to Difference and System GMM in Stata, The Stata journal, Vol. 9, No. 1 (2009), pp. 86-136.
50 This also accounts for the potential endogeneity of globalization, e.g., HDI and other human QOL-gap
may induce poorer countries to pursue more inward-oriented policies. However, the Sargan test indicates that endogeneity is not an issue. Frank Windmeijer, A Finite Sample Correction for the Varianceof Linear Efficient Two-step GMM Estimators, Journal of Econometrics, Vol. 126 (2005), pp. 25-51.
51 R. Scot Frey and Ali Al-Roumi, Political Democracy and the Physical Quality of Life: The Crossnational Evidence, Social Indicator Research, Vol. 47 (1999), pp. 73-97.
31

22

Freedom House, Freedom in the World Country Ratings 1972-2008, 2009, http://www.freedomhouse.
org/ratings/index.htm (accessed August 27, 2009).
53 M. Joseph Sirgy, Dong-Jin Lee, Chad Miller, and James E. Littlefield, The Impact of Globalization ona Country’s Quality of Life: Toward an Integrated Model, Social Indicators Research, Vol. 68, No. 3(2004), pp. 251-298; Ming-Chang Tsai, Does Globalization Affect Human Well-Being? , Social Indicator Research, Vol. 81, No. 1 (2007), pp. 103-126.
54 David S. Brown, Reading, Writing, and Regime Type: Democracy’s Impact on Primary School Enrollment, Political Research Quarterly, Vol. 52 (1999), pp. 681-707.
55 See Note 29.
56 Robert J. Barro, The Determinants of Democracy, Journal of Political Economy, Vol. 107 (1999), pp.
S158-S183.
57 Randa Sab and Stephen C. Smith, Human Capital Convergence: International Evidence, IMF Working Paper WP/01/32, Washington, D.C.: IMF, 2001.
58 According to Chris (Hristos) Doucouliagos and Martin Paldam, The Aid Effectiveness Literature: The
Sad Results of 40 Years of Research, Journal of Economic Surveys, Vol. 23, No. 3 (2009), pp. 433461, most of the evidence shows that aid (for the last 40 years) has not been effective. The conclusion
has been drawn by examining the whole literature on the aid effectiveness, which consists of 97
econometric studies done by the end of 2004. The authors have also shown that the research community
is reluctant to publish their negative results.

52

Appendices follow

23

APPENDICES

Appendix I. Variables and Their Weights of the KOF Index of Globalization

A. Economic Globalizationi) Actual Flows– Trade (% of GDP)
– Foreign Direct Investment, flows (% of GDP)
– Foreign Direct Investment, stocks (% of GDP)
– Portfolio Investment (% of GDP)
– Income Payments to Foreign Nationals (% of GDP)ii) Restrictions– Hidden Import Barriers– Mean Tariff Rate
– Taxes on Int’l Trade (% of current revenue)– Capital Account Restrictions
B. Social Globalizationi) Data on Personal Contact– Telephone Traffic– Transfers (% of GDP)
– International Tourism– Foreign Population (% of total population)– International Letters (per capita)ii) Data on Information Flows– Internet Users (per 1000 people)– Television (per 1000 people)– Trade in Newspapers (% of GDP)iii) Data on Cultural Proximity– Number of McDonald's Restaurants (per capita)– Number of Ikea (per capita)– Trade in books (% of GDP)
C. Political Globalization– Embassies in Country– Membership in International Organizations– Participation in U.N. Security Council Missions– International Treaties

[38%]
(50%)
(19%)
(20%)
(23%)
(17%)
(21%)
(50%)
(21%)
(29%)
(25%)
(25%)
[39%]
(34%)
(26%)
( 3%)
(26%)
(20%)
(26%)
(34%)
(36%)
(36%)
(28%)
(32%)
(37%)
(39%)
(24%)
[23%]
(25%)
(28%)
(22%)
(25%)

Notes: The number in parentheses indicates the weight used to derive the indexes.
Weights may not sum to 100 because of rounding. All indexes range between 0 (not globalized) and 10(globalized).
Source: Axel Dreher, Does Globalization Affect Growth? Empirical Evidence from a New Index, Applied
Economics, Vol. 38, No. 10 (2006), updated in Axel Dreher, Neol Gaston, and Pim Martens, Measuring Globalization - Gauging Its Consequence, New York: Springer, 2008. Also available at: http://globalization.kof.ethz.ch/static/pdf/variables_2009.pdf

24

Appendix II. List of Dependent Variables and Their Definitions

1.

Human development index (HDI) is a summary measure of human development. It measures
the average achievements in a country in three basic dimensions of human development:• a long and healthy life, as measured by life expectancy at birth.
• knowledge, as measured by the adult literacy rate (with two-thirds weight) and the combined primary, secondary, and tertiary gross enrollment ratio (with one-third weight).
• a decent standard of living, as measured by GDP per capita in purchasing power parity(PPP) terms in US dollars.
Source: UNDP, Human Development Report 2007/08.

2.

Life expectancy at birth indicates the number of years a newborn infant would live if prevailing patterns of mortality at the time of its birth were to stay the same throughout its life.
Source: World Bank staff estimates from various sources including census reports, the United Nations
Population Division's World Population Prospects, national statistical offices, household surveys
conducted by national agencies, and Macro International.

3.

Adult literacy rate is the percentage of people ages 15 and above who can, with
understanding, read and write a short, simple statement on their everyday life.
Source: United Nations Educational, Scientific, and Cultural Organization (UNESCO) Institute for
Statistics. Note: Break in series between 1997 and 1998 is due to change from International
Standard Classification of Education (ISCED76) to ISCED97. Recent data are provisional.

4.

Gross enrollment ratio is the ratio of total enrollment, regardless of age, to the populationof the age group that officially corresponds to the level of education shown. Primary education provides children with basic reading, writing, and mathematics skills along with anelementary understanding of such subjects as history, geography, natural science, social science, art, and music.
Source: United Nations Educational, Scientific, and Cultural Organization (UNESCO) Institute for Statistics.
Note: Break in series between 1997 and 1998 is due to change from International Standard Classificationof Education (ISCED76) to ISCED97. Recent data are provisional.

5.

GDP per capita based on purchasing power parity (PPP). PPP GDP is gross domestic
product converted to international dollars using purchasing power parity rates. Aninternational dollar has the same purchasing power over GDP as the US dollar has in the
United States. GDP at purchaser's prices is the sum of gross value added by all resident
producers in the economy plus any product taxes and minus any subsidies not included in
the value of the products. It is calculated without making deductions for depreciation of
fabricated assets or for depletion and degradation of natural resources. Data are in current
international dollars.

Source for No. 2 - No. 5: World Bank, WDI online database.
Note: GDP per capita is also used as control variable for the rest of the dependent variables other than GDP per
capita.

25

Appendix III. List of Control Variables and Their Definitions(Note: All the variables, except Democracy Index, are taken from WDI online database of the World Bank,
hence the definitions are sourced from WDI online database)1.

Annual population growth rate (annual %): Population is based on the de facto definitionof population, which counts all residents regardless of legal status or citizenship—except
for refugees not permanently settled in the country of asylum, who are generally consideredpart of the population of the country of origin.
Source: World Bank staff estimates from various sources including census reports, the United Nations
Population Division's World Population Prospects, national statistical offices, household surveys
conducted by national agencies, and Macro International.

2.

Urban population growth (annual %): Urban population is the midyear population of areas defined as urban in each country and reported to the United Nations.
Source: World Bank staff estimates using United Nations, World Urbanization Prospects.

3.

Age dependency ratio is the ratio of dependents—people younger than 15 or older than
64—to the working-age population—those ages 15-64. For example, 0.7 means there are 7
dependents for every 10 working-age people.
Source: World Bank staff estimates from various sources including census reports, the United Nations
Population Division's World Population Prospects, national statistical offices, household surveys
conducted by national agencies, and Macro International.

4.

Electric power consumption measures the production of power plants and combined heatand power plants, not including transmission, distribution, and transformation losses andown use by heat and power plants.
Source: International Energy Agency, Energy Statistics and Balances of Non-OECD Countries andEnergy Statistics of OECD Countries.

5.

Irrigated land refers to areas purposely provided with water, including land irrigated bycontrolled flooding. Cropland refers to arable land and permanent cropland.
Source: Food and Agriculture Organization, Production Yearbook and data files.

6.

Democracy indicator consists of two key rights: political and civil. Political rights measure
is based on subjective indicators that annually rank each country on a scale from one (highest
level of political rights) to seven (lowest level of political rights). Similarly, the civil liberties measure is used to capture personal rights such as those to free expression and to organize or demonstrate, measured on the same scale from one to seven. These two Freedom
House measures of democracy are averaged and normalized to range from zero to one hundred, with one hundred representing full democracy. The measures of democracy are takenfrom Freedom House (2009) and are available from 1972 to 2008.
Source: Freedom House, Freedom in the World 2009: The Annual Survey of Political Rights and Civil
Liberties, Lanham, MD: Rowman & Littlefield, 2009. http://www.freedomhouse.org/template.
cfm?page=1

Note: GDP per capita is also used as the control variable for the rest of the dependent variables, not including
GDP per capita.

26

Appendix IV. Summary Statistics

Variable

Obs.

Mean

Std. Dev.

Min

Max

HDI gap

126

0.285

0.128067

0.031

0.56

Life exp. gap

126

15.5646.953864

1.935

36

Adult literacy gap

126

27.46623.84905081Gross enrollment gap

122

20.91914.42645

-10.1

54

GDP per capita gap

12614801.78408-13023.529349.9

Overall globalization index

12642.46715.756

14.45

86.36

Economic globalization

119

44.61320.029

9.84

96.34

Social globalization

126

33.41920.875

8.05

91.04

Political globalization

126

53.25119.250

12.07

90.62

Population growth rate

126

1.806

0.814

-0.557

4.178

Urban-population growth rate

126

2.971

4.549

-42.905

11.277Age dependency ratio

126

69.63115.09437.08796.422Irrigated land (% of cropland)

78

22.27616.435085.365

Manufacturing value-added(annual growth rate)

107

5.767

8.516

-22.77

30.29

Electricity consumption (kWhper capita)

99992.333

1707.165

6.569

8507.197

Democracy index

126

46.49527.026091.66727

28-0.2023

Democracy index（dindex）

0.62790.8036-0.3819-0.1445-0.2782-0.0089

Urban-population growth rate（urpgrwth）

Age dependency ration（agedepr）

Irrigated land % of cropland（irrland）

Manufacturing value-added（Manvadd）

Electricity consumption（Elecpcp）

Democracy index（dindex）

1-0.6006

Electricity consumption（Elecpcp）

Population growth rate（Png）-0.081

Manufacturing value-added（Manvadd）

png

0.0497

Irrigated land % of cropland（irrland）-0.0855

Index of political globalization（pgblz）

0.5639-0.7597

Index of social globalization（sgblz）

Age dependency ration（agedepr）-0.6156

Index of economic globalization（egblz）

0.4034-0.6588

Index of overall globalization（gblz）

Urban-population growth rate（urpgrwth）

0.1623GDP per capita gap（dgdppcp）

0.382

0.8511Gross enrollment gap（denrol）

Population growth rate（Png）

0.9212

Adult literacy gap（dadultlr）

1
0.8771dhdi

Life exp. gap（dlifexp）

HDI gap（dhdi）

Appendix V. Correlation Matrix

1-0.2649-0.2099-0.0741-0.2709

0.5282

1

urpgrwth-0.0871-0.4951-0.0991-0.1594

0.6174

0.5367

0.4628-0.0721-0.641-0.4796-0.5358

0.0836

0.6966

0.7924dlifexp-0.1509-0.593-0.2062-0.36291

agedepr-0.0985-0.419-0.08310.08290.51730.45550.47680.0235-0.645-0.6222-0.5819-0.01210.79841

dadultlr

11-0.1801

0.13120.1042

irrland-0.1214-0.5077-0.1390.10150.39340.32480.3381-0.0667-0.5661-0.5004-0.5127

0.1249denrol-0.24380.2041

1

manvadd-0.1596-0.1058

0.21990.2488-0.2454-0.2101-0.28120.40990.18450.27130.3322

1

dgdppcp10.30281

elecpcp0.2246

0.61520.206-0.1441-0.4863-0.2221-0.17510.54440.92150.8964gblz

1

dindex1

0.008

0.43650.2116-0.329-0.2809-0.1105-0.0833

0.21160.7795egblz

10.3386

0.69790.1134-0.0729-0.5358-0.3061-0.2358

0.3576sgblz

10.26590.34110.17920.184-0.4067-0.1249-0.1138pgblz

Significance of the Japan-India Partnership for East Asian Regionalism

Céline Pajon

I believe the time has come for our two ancient civilizations to build a strong contemporary relationship involving strategic and global partnership that will have agreat significance for Asia and I believe for the world asa wholePrime Minister of India Manmohan Singh, Address to the
Joint Session of the Japanese Diet, December 15, 2006
Abstract
The construction of an integrated East Asia and an East Asian community is an important
objective of the strategic partnership built by Tokyo and Delhi. Since the 1990s, India has indeed
been keen on reintegrating East Asia for economic and political reasons. For its part, Japan isinterested in getting closer to India, which shares its desire to build a multipolar Asia and counterbalance Chinese power. In this regard, Japan played an essential role in securing the participation of India in the East Asia Summit.
The regional project is underpinned by a discourse on shared democratic values, common
interests, and cultural references. Since the late 19th century, Japan and India have indeed triedin their own way to theorize, promote and lead East Asia as a region. These efforts, along withthe famous interactions between Japanese and Indian intellectuals and independence leaders,
are used today to justify their rapprochement.
Despite the diplomatic discourse, it seems that the Japan-India partnership is mainly responding to neorealist concerns in East Asia dealing with the balance of power. This nascentpartnership shall be closely considered as an interesting new element in the Great Game unfolding in East Asia, even if the Japan-India relationship is still shaped to a great extent by Chineseand US factors.

1. Introduction
The Japanese partnership with India is of particular significance regarding the constructionof an East Asian Community. This nascent relationship between the most developed and thelargest Asian democracies,”1 grounded on a rich historical legacy of contributions toward East
Asian regionalism, hopes to play a central role in the current regional construction.
The rapprochement between Japan and India since 2000 mainly results from the evolutionof the geopolitical context: the rise of China and the new strategic partnership between Delhi andWashington. The Indo-Japanese relationship also builds on Indian economic growth and the rediscovery of common values, interests and strategic objectives between the two nations.2
India has indeed been keen on reconnecting with East Asia since the 1990s for economic
and political reasons, while Japan started a re-asianization process after the 1997 crisis. Japantakes interest in getting closer to India, which shares its desire to build a multipolar Asia and29

counterbalance Chinese power. In this regard, Japan played an essential role in integrating India
into the East Asia Summit. This mutually beneficial relationship is also very significant for thisnew wave of Asian regionalism, which seems to shift from an Asia-Pacific to a broader East
Asia focus.
As Paul Evans3 has suggested, it is useful to distinguish between regionalization and regionalism, the latter dealing with the expression of an identity and a cultural bedrock that allows theconstruction of a regional organization based on economic and political convergence (regionalization). From a methodological perspective, this means that the Japan-India contribution shall be
examined for these two dimensions of the East Asian regional construction. The complex reality of Asian international relations justifies an analytic eclecticism”4 in order to grasp the mostcomprehensive image of the ongoing processes. While drawing from a broad realist perspective,
I will test some constructivist and functionalist approaches when reviewing Japanese and Indianpolicy and discourse about the construction of an integrated Asia.
This paper aims to discuss the implications of Japan-India partnership for the regional
project, the regional identity, and the regional balance of power. The importance of the nascentJapan-India relationship in Asia will be assessed, as well as its capacity to make sense for East
Asia identity and current regionalism.

2. The Regional Project behind the Current Indo-Japanese Rapprochement
The conjunction of exogenous and endogenous factors explains the current Japan-India rapprochement. The rise of China transforming the power paradigm in Asia is an object of concern
for both Delhi and Tokyo. The bilateral partnership is part of their effort to hedge against Chinese
power. The about-face of the American administration toward India since the year 2000 is another important reason behind Tokyo’s new approach toward Delhi.
The rapprochement also builds on Indian economic growth. Prompted by liberalization reforms since 1991 and accompanied by a charm offensive toward East Asia, it is an important element that motivated Japan to reconsider India as an attractive economic partner. The two countries also share common values (democracy and market economy) and strategic interests (building
a multipolar world, gaining a permanent seat at the United Nations Security Council).5
The historic visit of Prime Minister Mori to India in 2000 marked the turning point in the bilateral relationship; Japan and India decided to build a global partnership for the 21st Century.”6
Most of the motives underpinning the Japan-India rapprochement directly or indirectly relate to
the two countries’ ambitions in East Asia.
(1) Reinvesting the New Asia: Common Interests
Since the 1990s, the re-engagement in East Asia takes place in the context of the Look East
policy. Aiming at reconnecting India with a dynamic, integrated East Asia, it is part of an overall strategy to become a regional power. Accordingly, the Indian national interest has been widened to embrace the greater Indian Ocean, from the Persian Gulf to the strait of Malacca.”7 This
new strategic orientation is accompanied by a build-up of maritime capacity.8
Japan adopted a more proactive role in Asia in the wake of the 1997 Asian fiscal crisis,
when it provided a large amount of assistance for Asian countries and proposed the creation ofan Asian Monetary Fund. Even though this initiative, opposed by the U.S. and China, eventually failed, Southeast Asian countries came to see Japan as the real economic leader of Asia, andasked Tokyo to take a greater political role in the region.9 Since then, Japan has been very active
in promoting regional agreements in the economic, political, and security fields10 in an effort torefocus its diplomatic efforts toward Asia. This Japanese interest in East Asia also has to do with30

the rise of China and Beijing’s attempt to take the lead in the region.
India and Japan share the perception that Asia is the new development locomotive of the 21stCentury. Asia represents half of the world’s population, includes the world’s second economic
power, two giant nations that have grown at a fast pace (more than 7%), and a collection of new
industrialized countries. Asia has a high potential for economic cooperation with a vertical specialization, dense regional networks for production, and more than 55% intra-zone trade. In thiscontext, Tokyo and Delhi wish to support this new Asian era by defining ways to cope with the
US-defined arc of instability, building an arc of advantage”11 and contributing to the construction of an East Asian Community.
(2) The Diplomacy of the Arcs
In 2004, Manmohan Singh, the father of Indian liberal reforms in the 1990s, floated his vision of an arc of advantage and prosperity”12 across Asia, in the context of the failure of multilateral trade negotiations and the strengthening of regional groupings. Considered as an extensionof the Look East Policy, the arc of advantage is a new vision to promote a regional zone ofshared prosperity. This expression emphasizes the importance of reconnecting India to East Asia
through the multiplication of trade exchanges and development of reliable transportation routes.
This objective was to be reached by the completion of a Free Trade Agreement with
ASEAN.13 Furthermore, an Asian Economic Community14 encompassing the ASEAN+3 fromthe Himalayas to the Pacific Ocean would be built. This integrated market would enable large
scale movement of people, capital, ideas, and creativity.”15
Further elaborating on his vision, Singh proposed a Pan-Asia Free Trade Agreement in
December 2005 based on an ASEAN+6 framework,16 taking the European Union as a model.17
This vision is mainly a project of economic reintegration in East Asia, for India to take part inthe construction of a large pan-Asian free trade area, which could sustain the country’s economic
growth.
At the end of November 2006, Taro Aso, then Minister of Foreign Affairs (MOFA), introduced the expression Arc of Freedom and Prosperity.”18 It was one of the rare attempts to approach Japanese diplomacy in conceptual terms. Because this bold move provoked some negative
reactions, especially from China and some Middle Eastern countries, the rhetoric soon disappeared from the political discourse. This vision holds that Japanese foreign policy is founded ona new pillar, value-oriented diplomacy, based on universal values such as democracy, freedom,human rights, the rule of law, and the market economy. Accordingly, Japan shall assist the young
democracies in the outer rim of the Eurasian continent in order to build an arc of freedom andprosperity. As an Asian pace-setter in terms of democracy and economic development, Japan ispresented as a legitimate leader in the region. In the same statement, Aso stated that Japan mustalso make its ties even firmer with friendly nations that share the common views and interests.
Comparing Japanese bilateral relations with China and India, Taro Aso also called for an improvement in the relationship with Delhi.
In contrast with the Indian arc, which is mainly of an economic nature, the Japanese vision of the arc is much more political and deals with the promotion of democracy, to allow amore balanced economic freedom and shared prosperity. However, in March 2007, Minister of
Foreign Affairs Aso and his Indian counterpart Mukherjee reaffirmed that there exists common
objectives and values between the idea of Arc of Freedom and Prosperity proposed by Japanand the idea of Arc of Advantage and Prosperity proposed by India, and that realisation [sic]of such common ideas would benefit not only Japan and India but also the whole of Asia.”19
It must be added that in a recent speech on foreign policy given at the end of June 2009,
Prime Minister Aso elaborated on the concept of Arc of Freedom and Prosperity as a basis forforming a modern-day version of the Silk Road. This new vision, calling for connecting routes
31

from the Pacific Ocean to Europe, clearly meets the Indian version of the arc.”20
Japan and India used the arc metaphor in order to advance their vision of an integrated,
multipolar East Asia, extended from India to Australia and New Zealand.
(3) Japan, India, and the Genesis of the East Asia Summit
Since the beginning of the 21st century, in the context of the failure of global trade mechanisms, numerous bilateral and multilateral Free Trade Agreements were tied up in East Asia.
With more than 80 agreements, the question is now how to shift from a complex noodle bowl ofoverlapping FTAs to a meaningful pan-Asian framework. The idea of building an East Asian
community eventually came up after a process of reflection led by the countries of ASEAN+3 (orAPT for ASEAN Plus Three).
In 1998, APT established successively the East Asian Vision group (1999-2001) andthe East Asia Study Group (EASG). The EASG report, issued in 2002, concluded that theASEAN+3 framework remains the only credible and realistic vehicle to advance the form andsubstance of regional cooperation in East Asia.”21 The report made no mention of India or Australia. However, intense diplomatic pressure from Singapore, Japan, Indonesia, and Vietnam
succeeded in including India in the project, and in less than 3 years.22 The main reasons behind
this change of heart were both realpolitik concerns and an economic rationale; ASEAN countries
eventually agreed that the presence of two demographic and economic giants in the East Asia
Community would be better than one. This concern matched perfectly with Japanese interest
to balance China in the region.
In the meantime, Prime Minister Koizumi proposed an East Asian community in 2002,
with ASEAN+3, Australia, and New Zealand as the core founding members, while remaining
open to the U.S., India, and others.23 India was later included as a full member in the Japanesevision of a regional project. This invitation resulted from the recognition that India is no longer
a local power but one of the three major powers of Asia.”24 Also, the Japanese vision of Asia
broadened from East Asia (APT) to the entirety of Asia, including South Asia. Three main
reasons accounted for this new strategic horizon: economic globalization (linked with India’s
economic growth), the regional security issue (especially the revelation of proliferation connections between North Korea and Pakistan) and Japan’s security interest (in particular, the safety ofmaritime routes and the JMSDF missions in the Indian Ocean after 2001).25
In April 2005, a strategic orientation was outlined for the Japan-India partnership which
included the realization of an East Asian Economic Community as an Arc of Advantage andProsperity.”26 On this occasion, Tokyo conveyed its decision to support India’s membership in the
East Asia Summit. Before the first EAS, Japan and India lobbied to have a Chair declaration inwhich EAS (and not APT) would be presented as the basis for an East Asian Community.27
In addition, Tokyo proposed a CEPEA (Comprehensive Economic Partnership in East Asia
or Nikai initiative ) in April 2006. The CEPEA consists of a fund to start a comprehensive economic partnership (CEP) and a policy-oriented research institution based on the model of OECD:
the ERIA (Economic Research Institute for ASEAN and East Asia). This consultative body will
study the feasibility of a regional FTA, the ultimate end of the initiative.
The Greater East Asian Community would be organized around ASEAN at the core, withJapan, China, and South Korea as principal members and Australia, New Zealand, and India as
the outer circle.28 This larger framework allows Japan to counteract and contain China which
had stolen a march on Japan in knotting up bilateral FTAs in the region. Enlarging the East Asia
framework to embrace India also allows Japan to win U.S. approval for this new regional organization and thereby reconcile potentially contradictory interests: to become more actively involvedin East Asian regionalism while maintaining a strong alliance with the U.S.29
Despite the first mixed reactions to this ambitious project, Japan could count on India and32

its Pan-Asia free trade proposition (see supra), inasmuch as this latest proposal made India a full,
original member of a community founded on an ASEAN+4 concept, and could eventually extend
to include Australia and New Zealand.
Both projects had two rival proposals: the East Asia Free Trade Area (EAFTA), promotedby China at the second EAS and based on ASEAN+3; and the Free Trade Area of Asia-Pacific(FTAAP) supported by the U.S. in late 2006 (partly in reaction to East Asian regionalization),and viewed as a revival of APEC (excluding India). Japan supported the U.S. proposal as oneof the multilayered efforts in the region,”30 meaning that it does not compete with the CEPEA
project, generally seen as more feasible than a broad FTAAP. At the Second EAS (January 2007),the Chair Statement eventually announced that the CEPEA proposal would be studied. A modus
vivendi was found between Japan and China by stating that ASEAN would stand as the driving force.31 Although the legitimacy of the ASEAN+6 framework has been debated, especiallyby China and Malaysia, it was eventually endorsed by ASEAN; in the Chairman’s Statement of
the 2006 and 2007 ASEAN Summits, the EAS is described as an important component of themerging regional architecture [that] would help build an East Asian Community. Besides, theASEAN+6 framework makes sense economically; most economic assessments conclude that an
ASEAN+6 Free-trade zone would be more efficient than an ASEAN+3 FTA.32(4) The East Asia Summit and the Question of Asian Identity
The EAS is generally presented as a larger, improved version of the East Asia Economic
Caucus (EAEC) proposed by Malaysian President Mahathir in 1990. The EAEC proposal was
designed to counter the ASEAN’s integration in APEC and create a purely Asian economic
organization, without the Western nations. As such, it drew extensively from the discourse on the
superiority of Asian values (mainly equated with Confucian values) that explain the success of
the Asian model of development.
It was an early vision of the ASEAN+3—notwithstanding the discourse on Asian values—
but the project failed because Japan did not want to commit to this organization that excluded the
U.S. Also, the Asian countries lacked a common experience and common others to make theirorganization meaningful enough. The 1997 Asian crisis provided for both elements.33 Moreover,in 1996, the constitution of the Asia-Europe Meeting (ASEM) confirmed that the EU equatedAsia with East Asia. At that time, the candidacy to involve India in the forum was rejected.34
Japan and India share a functionalist approach toward East Asian regionalization. Aiming atpreserving peace and prosperity in Asia, they both support the construction of a free-trade area inorder to sustain growth and connect the whole Asian region, from India to Australia.
According to a recent survey, 81% of the Asian strategic elite expresses support for building
an East Asian Community ; however, the membership is still debated.35 This debate highlights
the lack of a well-defined East Asian identity. In the EAS, East Asia is understood as a geopolitical, constructed concept, rather than a purely geographical expression. Actually, the origin of
the idea of a broader East-Asia or Greater Asia community can be traced back to the prewar
period, when, in the context of anti-imperialism and anti-westernism, Japanese and Indian intellectuals conducted a national discussion on the Asian identity.

3. Coming Back to the Roots: Significance of Past Interactions on Pan-Asianism
Historical and cultural references on bilateral connections regarding Asianism and Asian
identity are extensively used in the Indian and Japanese diplomatic discourses. Most of the time,
both Indian and Japanese diplomats or leaders elaborate on a romantic vision of the relationship, referring to early Buddhist connections (travel of the Indian monk Bodhisena to Japan in33

the 8th Century), the friendship of Tagore and Okakura Tenshin (end of the 19th Century until
1913), the Japanese support of the revolutionary activities of Rash Behari Bose (1915-1945), andChubas Chandra Bose (1943-1945), and the dissenting judgment of Justice Radhabinod Pal at theTokyo war crimes trial in 1948.36
These references are significant at the bilateral level, but also at the regional level. It is thenimportant to look at the true history behind the recurrent clichés used by the politicians to understand their meaning. It is also a unique occasion to study the Indian and the Japanese vision of
pan-Asianism and to think about the current significance of this ambivalent ideology for current
Asian regionalism. Even if pan-Asianism is a rejected discourse today because it underpinned theJapanese violent militarism in the region, it is still an important part of the cultural and intellectual bedrock of Asian identity.
(1) Ambivalence of the Pan-Asianist Discourse in Japan and India
The discourse on Asia (labeled as Asianism or pan-Asianism ) in Japan and India
was designed in the context of both countries’ nationalist projects against Western domination at
the turn of the 20th century. Asianism claims that despite their diversity, the Asian countries sharecommon cultural values, especially a high degree of spirituality and aesthetic sensitivity, in opposition to the materialist and decadent West. The aim is to give the Asian countries a sense of unity
based on a renewed pride in Asian identity, different from the Western vision of Asia as a backward region. Ultimately, Asia is a rallying cry for Asian nations to come together to escape or
emancipate themselves from colonization.
As such, Asia is a malleable concept that was invested in by ambivalent, contradictory
political projects. Koschmann successfully captured this idea in a nutshell: Without the West
there is no East. The very idea of Asia is ultimately empty and variously exploitable. The ideology of Asianism rejects that emptiness by attributing positive, essential meaning to Asia, however
it might be conceived geographically.”37 This analysis is shared by an important Japanese historian, Takeuchi Yoshimi, in his book Nihon to Ajia (1st edition 1966).
In India and Japan, pan-Asianism was used both as a project of national emancipation and a
project of domination in the region.
In Japan, Asianism could be characterised by three elements: (1) the resistance to western
influence in the region; (2) the belief in a common identity in Asia; and (3) the claim of Japan totake the lead against Western imperialism.38
Originally, Asianism was developed as a reaction to the westernization of Japan during the
Meiji era (1868-1912). At that time, Japanese authorities, in order to protect national independence, decided to take a shortcut to modernization by rapidly adopting and mimicking Western
institutions and cultural habits. At Fukuzawa Yukichi’s call in 1895, it was time to escape thefellow Asian countries, considered as backward, and to join the modern West (datsuA nyûO). Asa reaction, several intellectuals and politicians began to advocate a return to Asian values andtraditions. They claimed that Asia, not the Western club of Great Powers, should be the place forJapan’s national project.39 While the liberal school called for Japanese solidarity with the oppressed nations of Asia, the hardliners asserted Japanese superiority and hegemony in the region. 40
On the other hand, the Indian elite had to get rid of the inferiority complex infused by the
British colonizers in order to develop its own nationalism. This process involved a rediscovery
of Indian traditional values and history reconsidered in a positive light.41 In this context, the concept of an Asian identity and unity was very appealing and supported the formation of an Indian
national identity. Thus, the two processes worked in synergy. In India, the universalist school(Tagore, Gandhi, Nehru) called for an Asian Federation, that would serve to better advance theinterest of Asian countries toward freedom and independence,42 while the Greater India school34

advocated a new Indian supremacy within its cultural sphere of influence, from Kerala to Indonesia.”43 The Greater India ideology saw India as a benevolent hegemon that has spread its culture and spirituality (Buddhism and Hinduism) in South and Southeast Asia, making the region
its cultural backyard.
(2) Japanese and Indian Contributions to Pan-Asianism Thinking
The early references in Japan to Asianism (ajiashugi), which first appeared in 1892, referred
to a community of history and values among Japan, Korea, and China.44 The stress put on the anti-westernism and anti-imperialism explains the later extension of the concept to embrace Southeast Asia, and eventually South Asia.45
In India, meanwhile, the fascination with Japan’s modernization process and its victory overRussia in 1905 was huge, and several opinion leaders came to see Tokyo as an example and avaluable partner in the Indian fight for independence.
The interactions between Japan and India on pan-Asianism were mainly via individuals.
India, of course, was under British colonial rule. On the other hand, the role of the Japanese state
was ambivalent. Tied to its alliance with Great Britain from 1902, Tokyo was not supportive of
the pan-Asianist trend until the 1920s. When Japan gained the status of quasi-great power, panAsianism emerged as a practical ideology that could be implemented to demonstrate Japan’s cultural and political might in Asia.46 Meanwhile, growing Japanese differences with its British ally
led to greater attention and protectiveness toward the Indian anti-colonial nationalists who sought
Japanese support. Despite this involvement, one must keep in mind that support for Indian anticolonialism actually came from the margins of Japanese society.”47(3) Okakura and Tagore
The Japanese art critic Okakura Kakuzo (or Okakura Tenshin, 1862-1913) asserted in 1903
in the first sentence of his major work The Ideals of the East (1904): Asia is one. This book describes the striking spiritual values of the East and deems Japan to represent the quintessence of
Asian culture. As such, Japan is presented as the central actor (but not hegemonic actor) in Asianmodernization and emancipation from the western powers.48
The strong friendship that united Okakura with the Bengali poet Tagore (1861-1941)is well known. Okakura met Tagore in India, where he traveled and lived for a while (19011902). Working on Asian art, he wrote in English and mostly for a foreign audience (two of his
four masterworks were written in India), which made him an exception in the Japan of his day.
Okakura developed a particular definition of Asia, similar to Tagore’s view, that evolved from a
broad European-biased view to a Buddhist-tinged vision in which Asia equated with the Buddhist civilization Buddhaland.”49
Okakura was actually more famous abroad than in Japan, where the political and intellectual
elite (including Okawa Shumei) rediscovered his work in the 1930s in their attempt to build theconcept of a Greater East Asia Sphere of Co-prosperity (Daitôa Kyôeiken). Okakura is evenregarded by some as one of those who inspired the Bengali revolutionaries of the Secret society
Anushilam Samiti at the origin of the terrorist independence movement in Bengal (though others
question his real influence).50
Tagore also traveled to Japan, and in a 1916 message he expressed his admiration for an
Asian nation that could embrace modernity and defeat a Western country in military combat. He
called upon Japan to lead as a virtuous example of a benevolent, spiritual, alternative modernity.51
But Tagore also worried about the rising Japanese nationalism. In his lecture Nationalism inJapan, he stated: What is dangerous for Japan is not the imitation of the outer features of theWest but the acceptance of the motive force of the Western nationalism as her own.”52
In 1938, in his correspondence with the poet Yone Noguchi, Tagore bemoaned Japan’s ag35

gressive expansionism and wrote that the doctrine of ‘Asia for Asia’…as an instrument of political blackmail has all the virtues of the lesser Europe which I repudiate and nothing of the larger
humanity that makes us one across the barriers of political labels and divisions.”53
The friendship between Okakura and Tagore is idealized as being representative of IndiaJapan close interactions for pan-Asianism. However, upon closer inspection, we discover that
Okakura’s liberal vision of Asianism was not heard in Japan, and that his work was distorted in
the 1930s by expansionists. Also, this reference obscures Tagore’s critical evaluation of Japanesenationalism after the 1920s and Okakura’s passing.
(4) Imperialist Japan and Indian Revolutionaries
In the 1930s and 1940s, the pan-Asianist ideology was fully part of the Japanese state imperialist project. As the invasion in China advanced, most Asian leaders turned their backs on
Japan. Tokyo then sought to legitimize its behavior by referring to an early, liberal pan-Asianismof the sort promoted during the pre-World War One era.54
Even though Japan was harshly criticized55 by the core leaders of the Congress Party like
Gandhi and Nehru, its connections with some Indian revolutionaries were maintained as long as
both parties saw a way to advance their respective interests.
Rash Bihari Bose, who had been living in Japan since 1915, married a Japanese woman andwas given Japanese nationality. He used his network in ultra-nationalist circles56 to gain access toPrime Minister Tojo Hideki, persuading him to support the Indian anti-colonial cause. As a result,
two conferences gathering Indian expatriates in Asia were held in Tokyo and Bangkok in 1942
where it was decided to establish the Indian Independence League and the Indian National Army
(INA).
Tokyo was actively involved in the formation of the INA in Singapore, initiated by the intelligence agency F-Kikan, composed of Indian prisoners of war captured in the Malaya and Burmafronts. But the constitution of the INA complicated the relationship between the Indian revolutionaries and the Japanese Central command who wanted to use the army as a bulwark for theGreater East Asian Co-Prosperity Sphere on the Burmese front. However, the charismatic revolutionary Subhas Chandra Bose, who took command of the INA in 1943, reversed the situation andconvinced the Japanese to attack Imphal in Northeast India. The operation turned out to be one of
the most decisive early defeats for the Japanese Imperial Army.57
In the wake of the war, the dissenting judgment by Indian Justice Radabhino Pal at International Military Tribunal for the Far East reflected the magnanimity of some Indian nationalists
toward imperialist Japan. Justice Pal, who had studied in Kolkata, was well aware of the connections between independence-seeking Bengalis and Japanese nationalists. He had a great admiration for Japan.58 He denounced the political bias of the Tokyo trial as victors’ justice. He
considered that the Tokyo trial wrongly judged and condemned oriental civilization, identified as
the cultural root of Japan’s militarism.59 However, Pal’s opinion was his own, and was not representative of the Indian government.60(5) A Utilitarian RelationshipThis short survey of Japan-India historical interactions regarding Asia reveals, first of all,the asymmetry of interest between the two countries; while Japan is clearly identified as a leader
and key player in the region by Delhi, India is viewed as a country at the margin of East Asia andthe Japanese strategic horizon. The Japanese interest in India at that time was a very contextual
one and resulted more from an anti-western sentiment than a genuine interest in India’s situation.
Anand Mohan Sahay,61 who spent almost twenty years (from 1923) in Kobe and was very disappointed to find no Indian or Japanese allies to support India’s independence, is illustrative of
Indians who felt deceived by the Japanese position. Also, the interest in India nurtured by Okawa
36

Shumei, a major theorist of imperialist pan-Asianism in Japan, actually originated from his antiwesternism and racism; he never sought to travel to India and thus developed an exotic, romantic
view of the country.62
On the Indian side, it is important to recall that as Japan turned imperialist, the core leadersof the Congress Party became very critical and turned their attention to China. The emotional attractiveness of China stemmed from a belief in the spiritual unity of India and China and a common experience of oppression. Both countries were described by Nehru in 1938 as sister nations.”63 The reality is that only a minority of Indian anti-colonial nationalists placed their bet on
Japan.
The links between Japanese nationalists and Indian revolutionaries were therefore marginal
and fueled by self-interest. Each party used its contacts to further its own interests and agendas.
This is revealed by the efforts made by Subhas Chandra Bose to find an alternative ally in Chinaor the USSR to support the Indian liberation movement when the Japanese war effort began its
slide toward eventual defeat by late 1944.64 The initial common understanding centered on an
Asian identity was soon corrupted by the Japanese imperialist project.
(6) What is the Significance of These References Today?
In the 1990s, India grounded its Look East Policy in a cultural discourse that harked back to
the heritage of Tagore and Nehru. These references, coupled with a diplomacy focused on economic cooperation and exchange, were used to reassure East Asian investors for whom India wasa turbulent, distant country. This strategy was particularly used vis-à-vis Japan.65
The legacy of Tagore and Okakura served to establish common Asian values based on spirituality: Prime Minister Rao asserted in a speech in Japan in 1992: Asia is one, the essence of
this oneness being spirituality.”66 At the same time, he asserted that Asia was based on syncretism,
citing the Indian spiritual contribution to the Asian identity as the cradle of Buddhism and Hinduism in an attempt to integrate India into East Asia, at least culturally.
In Japan, the use of these references has several meanings. First, the reminders that India
and Japan share only positive history are supposed to reassure the business community, scaldedby the anti-Japanese demonstrations that took place in China in 2005 because of their historicaldisputes.
These references also portrayed India in a positive light, as an historically friendly nation
to Japan, and a stable partner that shares its democratic values. This attempt to mold a positive
perception of India in Japan complements Tokyo’s gradual softening of its stance toward India’s
nuclear power status.
Finally, these references are particularly used by right-wing, nationalistic politicians and intellectuals. These elements that focus on positive Japanese attempts to unite Asia and assist Asian
independence movements, and the mention of Justice Pal, can be used to present a prettier, sanitized vision of Japan’s wartime history. 67 By softening the perception of Japanese war crimes andquestioning the legal validity of the Tokyo trial, the neo-nationalists are trying to break awayfrom the postwar regime, instil a new sense of pride in the Japanese nation, and call for a strong
Japanese political role in the region without dwelling on the details of the past. Former Prime
Minister Shinzo Abe, who elaborated his nationalistic agenda for Japan in his book Toward a
Beautiful Country,”68 is a striking example. He is also an Indophile. When he traveled to India in
August 2007, he talked before the Indian Parliament about a broader Asia at the confluence of
the Pacific and Indian Oceans,”69 he went to Kolkata to visit the house of Subhas Chandra Bose,70
and he met with the son of Justice Pal.
Several Japanese scholars, like Takako Hirose,71 worry about the danger of such nationalist
rhetoric that does not represent healthy ground on which to build the current relationship. Moreover, it lends itself to an old-fashioned and stereotypical view of India, still an exotic country in37the minds of many Japanese.
As the legacy of Japan’s wartime imperialism prevented its postwar political influence andintimate involvement in the affairs of East Asia, India’s engagement with Southeast Asian countries was similarly impeded by that nation’s earlier rhetoric on an Indian cultural sphere ( Greater
India ). This meant that both powers had to make creative efforts to involve themselves substantively in the evolving architecture of postwar relationships within East Asia. Since they had neverfought or sought to dominate each other, and because they shared common values and perspectives arising from their status as democratic nations with market economies, Japan and India
found a basis for joining together in an effort to raise their influence in the region.
Cultural and historical reference points are thus used to advance national interests in building ties and integrating into a region. But India and Japan are, above all, pragmatic nations; assuch, they are also engaged in a classic diplomatic strategy of power balance.

4. Constructing an Integrated Asia or a Balanced Asia?
The China and United States factors are determining, to a great extent, the future shape of
relationships within East Asia and between East Asia and the rest of the world. What is the position of the Japan-India partnership regarding these two powers? Are they participating in a newaxis of democracies against China? Are they trying to balance U.S. power in Asia?
(1) The China Factor
Rising China is regarded with concern by both Japan and India. While both countries view
Beijing’s economic growth as an opportunity, they also worry about the military build-up and thegrowing diplomatic influence of Beijing in Asia and in the world. Their diplomatic rapprochement is thus a way for Tokyo and Delhi to hedge against China. This is particularly clear with respect to the Japanese side, as Tokyo is competing with Beijing to take the lead in shaping the newarchitecture for the region. Japan is now ready to assume a greater political role in the region as
the most advanced Asian democratic power, and seeks to weaken Chinese influence by highlighting the authoritarian nature of their regime.
If the relationship between New Delhi and Beijing is any warmer since 2002, it is still characterised by suspicion and mistrust. Several contentious issues like Tibet, the territorial disputes (inKashmir, Sikkim, and Arunachal Pradesh) and the competition for influence in the Indian Ocean
still loom large in the relationship.72 The military-strategic community in India is thus very receptive to the adoption of a containment strategy toward China.
On the other hand, even as India is open to a discussion on values,73 Delhi still sticks to its
strategic autonomy rhetoric and refuses to get embroiled in any diplomatic or security arrangements that openly aim at containing China.74 Despite official reluctance to use balance of power
rhetoric, and its rhetorical commitment to a traditional non-alignment policy, India is de facto
playing the realist game of balancing power in Asia in order to advance its national interests.75
In this context, the East Asia Summit framework has been characterized as an anti-region.”76 Shaun Breslin argues that the EAS is clearly not the most relevant and consistent framework to build the region, considering the diversity of the participants. He asserts that the EAS isactually advocated by the regional elite, in reaction to the nascent regional mechanisms that are
taking shape within the APT framework in an attempt to neutralize Chinese power.”77(2) The U.S. Factor
While the goal of balancing China is clearly shared by Japan and India, both countries arealso trying to find a balance in their relationships with the United States. The history of the quad38

rilateral initiative is telling with respect to Japanese and Indian expectations toward the U.S. andChina.
Tokyo supports the rise of complementary and alternative poles of power in Asia and thecreation of a network of like-minded partners. Highlighting the importance of drawing closer to
India, Prime Minister Abe (September 2006-September 2007) suggested that Delhi be includedin the ongoing strategic trilateral dialogue between Tokyo, Washington, and Canberra.78 This proposal received the blessing of Vice President Cheney in February 2007. This strategic quadrilateral is underpinned by a unity of democratic values that implicitly aims to exclude China.
The strategic component of this quadrilateral initiative was seen in the MALABAR 07-2
naval exercises, when 20,000 military personnel, 28 ships, 150 airplanes, and 3 aircraft carriers
assembled in the Bay of Bengal during October 2007.79
So far, it has been the only naval gathering of the four countries. The Chinese authorities
indeed voiced concerns about what they labeled as a foreshadowing of an Asian NATO.”80 As
a result of that, plus related domestic sensitivities, the Rudd administration in Australia decided
to withdraw from the quad, and the Indian communists put pressure on the Singh government toavoid it. As a result, the quadrilateral initiative is currently in abeyance.81
In this context, it seems unlikely that the rhetoric of a coalition of democracies will reappear in the short term. Moreover, this does not appear to be the diplomatic orientation of the new
Obama administration,82 nor of the Hatoyama government in Tokyo since September 2009. Evenso, it is worth noting that Japan participated twice in India-U.S. naval exercises in April 2007 andJune 2009.
If multilateral initiatives centering around the U.S. seem difficult to pursue because of Chinese sensitivities, it would, however, be more acceptable to include Washington in certain formsof a multilateral regional framework.
The question of U.S. integration into an Asian regional organization is central. The U.S.
is a de facto Asian power. It still maintains 80,000 soldiers in the Asia Pacific theatre and it is amajor trading partner for East Asian countries; the current crisis has shown how dependent theASEAN+3 countries are on U.S. economic growth. From a realist point of view, it therefore
seems inconceivable to build a viable regional economic and security structure without including
the U.S. Accordingly, 80% of APT experts strongly support the inclusion of the U.S. in EAS; thesame percentage supports the inclusion of India.83
Neither Japan nor China nor India really opposes the inclusion of the U.S. in the EAS, andthere is a broad consensus on an open and inclusive regional institution. The Obama administration is currently studying the possibility of signing the Treaty of Amity and Cooperation
with ASEAN,84 required to take part in the EAS. This signature could mean a greater U.S. commitment to the East Asia regional process in the next few years. In terms of balance of powers,
this scenario would enhance the weight of Japan and India in the region. However, a revival of
FTAAP, based on APEC, is also foreseen.85 In this perspective, India, which is not part of APEC,
would be marginalized. In terms of membership, the Rudd proposal on an Asia Pacific Community (EAS + United States) could be a compromise solution.86
The APEC Summit held in Singapore in November 2009 featured the new U.S. political willto get back to Asia. Few days before the summit, in Tokyo, U.S. President Obama, reaffirming
the strong ties binding the U.S. and Asia, stated: As an Asia Pacific nation, the United States expects to be involved in the discussions that shape the future of this region, and to participate fully
in appropriate organizations as they are established and evolve.”87 More importantly, U.S. Traderepresentative Ron Kirk announced that the U.S. will take part in the negotiations toward a Pacific Partnership (TPP) trade agreement, to be built on the Trans-Pacific Strategic Economic Partnership (P4) between Chile, New Zealand, Singapore, and Brunei. These negotiations, involving
Australia, Brunei, Chile, New Zealand, Peru, Singapore, the U.S., and Vietnam, aims to build a39high-quality FTA that would form the basis for a future FTAAP.88
On the other hand, the new Japanese Prime Minister Hatoyama, who took power after thehistoric victory of the Democratic Party of Japan in late August, is a strong advocate of an East
Asian Community gathering the ASEAN+6 countries, inspired by the European Union model.
Although Hatoyama repeatedly emphasized the importance of the U.S.-Japan partnership in East
Asia after Obama’s visit to Tokyo, the Japanese prime minister never formally listed the U.S. as acore member of the East Asian community.89
Examining these declarations, it seems that the Japanese and U.S. approaches to Asian regional architecture are increasingly diverging, which could cause additional friction within thealliance as the Hatoyama government is trying to adjust and balance its relationship with Washington.
What about India? By hosting his first state dinner in Indian Prime Minister Singh’s honor,
Obama tried to reassure him about the solidity of the U.S.-India partnership. However, Obama
did not elaborate on India’s role in Asian regional integration. New Delhi still hopes to be allowed to join APEC next year, as the moratorium on new members will expire. The Australian
government recently reiterated that it would back India’s bid,90 while Japan has remained mutethus far. The DPJ government will have to make up its mind, as Yokohama will host the 2010
APEC summit. However, India’s accession will raise many questions, such as the geographicallimits and the regional balance within the Asia Pacific Forum, and the issue of Pakistan’s place.
While Prime Minister Hatoyama has been devoting most of his energy to managing Japan’s
relationship with China and the United States, he has also attempted to reassure India about his
government’s interest in developing their bilateral relations by visiting Delhi toward the end of
2009. Hatoyama and Singh agreed to establish a 2-plus-2 high level dialogue involving seniorforeign and defence ministry officials of the two countries, to strengthen their political partnership.91 Hatoyama also expressed his resolve for an early conclusion of the bilateral FTA negotiations.
(3) Values in the East Asian Community
The debate between Peter Drysdale and Hugh White posted on the East Asia Forum website
is representative of the arguments on the role of values in the context of East Asian regionalism.92
While White argues that a regional political and security organization needs to be built on a common set of principles, Drysdale retorts that his vision is hopeless, considering the diversity of theactors. He calls for a rule-based, not a principle-based Asia Pacific Community”93 to secure thecooperation of all the regional players.
What about Japan? While the Japanese government favors the construction of an Asian
Community in principle, different approaches coexist and contend; some favor APT over EAS(for the Ministry of Finance), or the opposite (for the Ministry of Economy, Trade, and Industry),
while the mainstream supports a multilayered architecture with both APT and EAS (as MOFA).
Within the Japanese expert community, the realists tend to be against the EAS framework, deeming it to be romantic and unrealistic regarding the clash of interests between Japan and China,
and the importance of the United States in the region. Proponents of the East Asian community
argue that this common project would slowly engage all of the powers in the region and complement the respective nationalisms with a regional identity sentiment.94 While Tokyo supports afunctionalist approach toward East Asian regionalism, it also increasingly emphasizes the role ofvalues. But while the Japanese discussion of values and the arc does not necessarily reflect anidealist vision of international relations, it does have the merit of offering an alternative vision in
opposition to regional domination by a rising China, and that could become the strategic platform
for a coalition.95
India still maintains an ambiguous posture regarding support for values diplomacy. Sev40

eral opinion leaders are calling for a greater emphasis in the country’s foreign policy on Indian
democratic values and the Indian political model.96 Delhi will have to redefine its diplomacy inthe years to come. For the moment, India will avoid emphasizing liberal values so as to launch
an overt contest aimed at marginalizing or countering China, and it will probably seek to employ
Asian cultural norms so as to promote its own profile and influence within the broad Asian region.
A third set of conceptual visions has recently emerged, following the prewar concept of aunited Asia; based on anti-westernism and the cultural characteristics of the region, it also heeds
the 1990s emphasis on Asian values aimed at assigning priority to economic development—
hence the Asian economic miracle—over so-called (implicitly western ) universal humanrights. While it recognizes the originality of Asian culture and values, this new concept also includes universal values and norms like democracy, that are deemed suitable for Asia.97 This third
wave of regionalist values is called Neo-Asian Values.”98 This new approach is consistent with
the Japanese and Indian visions of East Asian regionalism.
Governments emphasize the conceptual ideal of community while they are hedging one
against another in Asia. The fluid balance of power in Asia dictates that mutual suspicion andpragmatic behaviour will remain characteristic features of the region’s political landscape. While
India and Japan share interests, they do not assign a high priority to their bilateral relationship,compared to their partnerships with China and the U.S. The Japan-India partnership is an interesting element in the current evolution of the Great Game in Asia, especially when there may besome prospects for a future concert of powers. However, it is not yet strong enough to significantly shape the course of international relations in Asia, and it is still very much dependent upon
the U.S. and China factors.99

5. Conclusion

Japan and India adopt a functionalist approach toward East Asian regionalism: their
aim is to preserve peace and prosperity in the region and build a free-trade zone in orderto sustain economic growth and promote Asian stability. At the same time, they support a
broader vision of East Asia, from India to Australia, in order to encourage multipolarity inthe region and create a favorable context in which they may advance their national interests.
From a constructivist point of view, the Japan-India vision of a Greater Asia, which draws
upon a common pre-war reflection on Asian identity, could be persuasive and relevant for
current regionalism, especially in the context of a blurred or unarticulated Chinese vision.100
Finally, from a realist point of view, Japan-India rapprochement cannot feasibly represent a
new axis against China, even if the balancing motive is present.
However, this nascent partnership is still dependent upon the international context
and is not yet in a position to shape the system to any significant degree. Also, the relationship suffers from the gap between Indian’s political will to draw nearer to Japan as part ofa strategy to become a central player on the Asian scene, and Japan’s interest in engaging
with India, although this position is consistent with its strategic priority of balancing against
China.
Despite these limitations, the Japan-India partnership is significant in that it strengthens thethird leg of the China-Japan-India triangle in Asia. Their historical experience in dealing with thethemes of Asian identity and regionalism in the prewar period could form the basis for allowing
the two countries to make a significant contribution to the construction of a new East Asian identity and community.

41Notes
To borrow the Indian terminology: Prime Minister Singh, Speech to the Japanese Diet, December 15,
2006. See the Appendix.
2 N.S. Sisodia and G.V.C. Naidu, India-Japan Relations, Partnership for Peace and Security in Asia,
New Delhi: Institute for Defence Studies and Analysis, 2006.
3 Paul Evans, Between Regionalism and Regionalization: Policy Networks and the Nascent East Asian
Institutional Identity, in T.J. Pempel, ed., Remapping East Asia: The Construction of a Region, Ithaca:
Cornell University Press, 2005.
4 Peter Katzenstein and Nobuo Okawara, Japan, Asian-Pacific Security, and the Case for Analytical Eclecticism, International Security, Vol. 26, No. 3 (Winter 2001/02), pp. 153-185.
5 In 2004, Japan, India, Brazil, and Germany formed the G4 in order to gather their claim to get a permanent seat in the UN Security Council.
6 See the Summary of Japan-India Summit Meeting (August 23, 2000), www.mofa.go.jp (accessed May
15, 2009).
7 David Scott, India’s Grand Strategy for the Indian Ocean: Mahanian Visions, Asia-Pacific Review,Vol. 13, No. 2 (2006), pp. 97-129.
8 This is a revival of Mahan and Panikkar doctrine (K.M. Panikkar, India and the Indian Ocean: An
Essay on the Influence of Sea Power on Indian History, London: Macmillan, 1945). See Indian Navy,
Strategic Defence Review: The Maritime Dimension-A Naval View, May 20, 1998.
9 Dirk Nabers, China, Japan, and the Quest for Leadership in East Asia, GIGA Working Papers No. 67,
February 2008, p. 19.
10 For example, Tokyo is the origin of ReCAAP (Regional Cooperation Agreement on Combating Piracy
and Armed Robbery against Ships in Asia).
11 Japan-India Summit Meeting-Summary, November 29, 2004.
12 Inaugural Address by Dr. Manmohan Singh, Prime Minister of India, Third India-ASEAN Business
Summit, October 19, 2004, New Delhi.
13 The agreement is still not finalized, one of the main obstacles being the liberalization of the Indian agriculture sector.
nd
14 This expression was first used in the Indian context by Prime Minister Vajpayee at the 2 India-ASEAN
Summit in 2003.
15 Inaugural Address by Dr. Manmohan Singh, Prime Minister of India, Third India-ASEAN Business
Summit, October 19, 2004, New Delhi.
16 ASEAN+ China, Japan, Korea, India, Australia, and New Zealand.
17 Amit Baruah, Manmohan Calls for Creation of Pan-Asian Free Trade Area, The Hindu, December 13,
2005.
18 Taro Aso, Minister of Foreign Affairs on the occasion of the Japan Institute of International Affairs
Seminar, Arc of Freedom and Prosperity: Japan’s Expanding Diplomatic Horizons, November 30,
2006.
19 Joint Press release-Visit of External Affairs Minister of India to Japan, March 2007.
20
Japan’s Diplomacy: Ensuring Security and Prosperity, June 30, 2009, at JIIA. However, the Japaneseconcept includes a larger group of countries, among them Central and Middle East Asian countries.
21 Final Report of the East Asia Study Group, ASEAN+3 Summit, November 4, 2002, Phnom Penh, Cambodia, p. 5
22 G. V. C. Naidu, India and the East Asian Summit, Strategic Analysis, Vol. 29, No. 4 (Oct-Dec 2005), p.
716.
23 Speech by Prime Minister of Japan Junichiro Koizumi, Japan and ASEAN in East Asia - A Sincere andOpen Partnership, Singapore, January 14, 2002.
24 Ambassador Yasukuni Enoki, The Japan-India Partnership, Lecture at USI, May 28, 2004.
25 Ibid.
26 Japan-India Partnership in the New Asian Era: Strategic Orientation of Japan-India Global Partnership,
April 28, 2005.
27 Bruce Vaughn, East Asian Summit: Issues for Congress, CRS Report for Congress, December 9,2005, p. 3.
28 Shinji Shigematsu, CEPEA: Is It Possible to Organize Asia-Oceanic Community? The Otemon Jour1

42

nal of Australian Studies, Otemon Gakuin University, Vol. 32 (2006), p. 22.
David Camroux, Asia…Whose Asia? A ’Return to the Future’ of a Sino-India Asian Community, The
Pacific Review, Vol. 20, No. 4 (December 2007), p. 561.
30 Junichi Sugawara, The FTAAP and Economic Integration in East Asia: Japan’s Approach to Regionalism and US Engagement in East Asia, Mizuho Research Paper 12, Tokyo, February 2007.
31 Mohan Malik, The East Asia Summit: More Discord than Accord, YaleGlobal, December 20, 2005.
32 Nagesh Kumar, Relevance and Challenges of Broader Regionalism in Asia, India Quarterly, Vol. 61,
No. 2, pp. 79-105; Masahiro Kawai and Ganeshan Wignaraja, EAFTA or DEPEA. Which Way Forward? ASEAN Economic Bulletin, Vol. 25, No. 2 (2008), pp. 113-139.
33 East Asian countries’ solidarity grew up out of the crisis difficulties. Japan acted as a leader by assisting
the affected countries and proposing an Asian monetary fund. The IFM and the U.S., who opposed Tokyo’s AMF, played the role of the others. Takashi Terada, Constructing an ‘East Asian’ Concept and
Growing Regional Identity: From EAEC to ASEAN+3, The Pacific Review, Vol. 16, No. 2 (2003), pp.
251-277.
34 However, in 2007, India (along with Pakistan and Mongolia) was integrated as a regular member in the
ASEM summit.
35 Bates Gill, Michael Green, Kiyoto Tsuji, and William Watts, Strategic Views on Asian Regionalism,
Survey Results and Analysis, CSIS, February 2009, p. 8.
36 For details, see the quotations of the discourses in the Appendix.
37 Victor Koschmann, Asianism’s Ambivalent Legacy, in Peter J. Katzenstein and Takashi Shiraishi
eds., Network Power, Japan, and Asia, Ithaca, NY: Cornell University Press, 1997, p. 83.
38 Yves Bougon, Le Japon et le discours asiatiste, pp. 241-253, in Philippe Pelletier dir., Identités territoriales en Asie orientale (NORAO), Les Indes Savantes, 2004, p. 243.
39 Sven Saaler, Pan-Asianism in Modern Japanese History – Overcoming the Nation, Creating a Region,
Forging an Empire, in Sven Saaler and Victor Koschman, eds., Pan-Asianism in Modern Japanese
History, Colonialism, Regionalism, and Borders, London: Routledge, 2007, pp. 2-3.
40 The pan-Asianism discourse cannot be identified entirely with the Japanese imperialist approach, assome intellectuals did not support the Japanese invasion of Asia; conversely, the imperialist school
mainly did use this pan-Asianism approach as a pretext for military expansion. See Cemil Aydin, Japan’s Pan-Asianism and the Legitimacy of Imperial World Order, 1931-1945, Japan Focus, March 12,
2008.
41 Christophe Jaffrelot, L’émergence des nationalismes en Inde. Perspectives théoriques, Revue Française de Science Politique, Vol. 38, No. 4, 1988, pp. 555-575.
42 T. A. Keenleyside, Nationalist Indian Attitudes Towards Asia: A Troublesome Legacy for Post-Independence Indian Foreign Policy, Pacific Affairs, Vol. 55, No. 2 (Summer 1982), p. 216.
43 Ibid., p. 230.
44 Bougon, Le Japon et le discours asiatiste, p. 241.
45 In 1917, Okawa Shûmei established the All-Asian Association (Zen Ajia Kai) that included India andWestern Asia.
46 Saaler, pp. 5-7.
47 Grant K. Goodman, Anand Mohan Sahay (1898-1991)-Indian Revolutionary in Japan, Electronic
Journal of Contemporary Japanese Studies, January 26, 2008.
48
It has been, however, the great privilege of Japan to realise [sic] this unity-in-complexity with a
special clearness. The Indo-Tartaric blood of this race was in itself a heritage which qualified it to imbibe from the two sources, and so mirror the whole of Asiatic consciousness. The unique blessing of
unbroken sovereignty, the proud self-reliance of an unconquered race, and the insular isolation which
protected ancestral ideas and instincts at the cost of expansion, made Japan the real repository of thetrust of Asiatic thought and culture…It is in Japan alone that the historic wealth of Asiatic culture canbe consecutively studied through its treasured specimens…Thus Japan is a museum of Asiatic civilization, Okakura Kakuzo, The Ideals of the East with Special References to the Art of Japan, London:
John Murray, 1903, pp. 4-5.
49 He then revived the old, traditional Buddhist vision of the world organized around the three poles of
Honchô (Japan), Tenjiku (India) and (Shintan) China. Pekka Korhonen, The Geography of Okakura
Tenshin, Japan Review, Vol. 13 (2001), pp. 107-128.
50 Peter Heehs, Foreign Influences on Bengali Revolutionary Terrorism 1902-1908, Modern Asian Stud29

43

ies, Vol. 28, No. 3. (July1994), pp. 533-556.
Rabindranath Tagore, The Message of India to Japan, New York: The Macmillan Company, 1916.
52 Rabindranath Tagore, Nationalism in Japan, in English Writings of Rabindranath Tagore, New Delhi:
Atlantic Publishers and Distributors, 2007, p. 281. The same warning was made by Sun Yat Sen in his
speech Pan-Asianism in Kobe (1924).
53 See the reproduction of the letters in Zeljko Cipris, Seduced by Nationalism: Yone Noguchi’s ‘Terrible
Mistake.’ Debating the China-Japan War with Tagore, Japan Focus, November 17, 2007.
54 Cemil Aydin, op cit.
55 When Japan began to invade China, the sympathy of the Congress Party toward Tokyo faded and turnedto the destiny of China. This caused concern for Indian activists in Japan, mainly because they fearedthat it would diminish Japanese support for Indian independence. In 1938 the Congress Party ordered aboycott of Japanese goods. Goodman, op. cit.
56 He had close contact with Toyama Mitsuru and the Black Dragon Society.
57 The battle lasted from March to July 1944, and the Japanese army was driven back to Burma with heavy
losses. This was the turning point of the Burma campaign, signaling the end of the Japanese offensiveon this front. See the work of Joyce C. Lebra, particularly: Jungle Alliance: Japan and the Indian National Army, Singapore: Asia Pacific Press, 1971.
58 Ashis Nandy, The Other Within: The Strange Case of Radhabinod Pal’s Judgment on Culpability,
New Literary History, Vol. 23, No. 1 (Winter 1992), p. 53.
59 Kei Ushimura, Beyond the Judgment of Civilization : The Intellectual legacy of the Japanese War
Crimes Trials, 1946-1949, LTCB International Library Trust, Tokyo, 2003, pp. 168-169.
60 Pal Hanji, Tokyo Saiban Hihan to Zettai Heiwa-Shugi (Justice Pal: His Criticism of the Tokyo Trial and
His Absolute Pacifism) by Takeshi Nakajima, Hakusui-sha, 2007, p. 308. Review by Fumiko Halloran,
The Japan Society Review, Issue 14, Volume 3 Number 2 (2008).
61 Goodman, op. cit.
62 Yukiko Sumi Barnett, India in Asia: Okawa Shumei’s Pan-Asian Thought and His Idea of India in
Early Twentieth-Century Japan, Journal of the Oxford University History Society, Issue 1, 2004.
63 Keenleyside, pp. 212-213.
64 Goodman, op. cit.
65 Isabelle Saint-Mézard, Eastward Bound, India’s New Positioning in Asia, Manohar, Delhi: Centre desciences Humaines, 2006, pp. 200, 202.
66 Ibid., p. 197.
67
Decades after War Trials, Japan still Honors a Dissenting Judge, The New York Times, August 31,
2007.
68 Shinzo Abe, Utsukushii Kuni e, Tokyo: Bungei Shunju, 2006. See Tsuneo Akaha, The Nationalist Discourse in Contemporary Japan: The Role of China and Korea in the Last Decade, Pacific Focus, Vol.
33, No. 2 (August 2008), p. 160.
69 Shinzo Abe, Confluence of the Two Seas, Speech at the Parliament of the Republic of India, August22, 2007.
70 The ashes of Chandra Bose, who allegedly died in a plane crash off Taiwan in 1945, are actually kept in
the Rentokuji temple in Tokyo, Suginami ward.
71 Personal interview, February 6, 2009.
72 China is assisting the construction of ports at Sittwe in Myanmar, Chittagong in Bangladesh, Hambantota in Sri Lanka, and Gwadar in Pakistan. This forms a string of pearls, Lisa Curtis, US-India Relations: The China Factor, Backgrounder, Heritage Foundation, No. 2209, November 25, 2008.
73 Voir C. Raja Mohan, Balancing Interests and Values: India’s Struggle with Democracy Promotion,
The Washington Quarterly, Summer 2007, pp. 99-115.
74 During his visit to China in January 2008, Prime Minister Singh insisted he would have no part in any
alliance with the United States, Australia, and Japan aimed at containing China, Singh Rules Out
Containment Factor, China Daily, January 15, 2008; Purnendra Jain, From Condemnation to Strategic Partnership: Japan’s Changing View of India (1998-2007), ISAS Working Paper, No. 41, March 10,
2008, pp. 13-14.
75 C. Raja Mohan, The Asian Balance of Power, Seminar, No. 487 (2000); Christophe Jaffrelot, Les
quatre points cardinaux de la diplomatie indienne: le régional et le global, l’idéalisme et le réalisme,
in Christophe Jaffrelot dir., New Delhi et le monde: Une puissance émergente entre Realpolitik et Soft
51

44

Power, Paris : Editions Autrement, 2008, pp. 7-31.
Shaun Breslin, Supplying Demand or Demanding Supply? An Alternative Look at the Forces Driving
East Asian Community Building, Policy Analysis Brief, The Stanley Foundation, November 2007.
77 Ibid., p. 9.
78 Abe, op. cit., p.160.
79 East Asian Strategic Review 2008, Tokyo: NIDS, 2008, p. 222.
80 A diplomatic meeting was held before the naval exercises, in May 2007 at the ARF summit (ASEAN
Regional Forum). The Chinese Foreign Ministry spokesman reacted: China believes that to enhancemutual trust, expand cooperation for mutual benefit and win-win, be open and inclusive is the global
trend. China Slams India, US, Japan Alliance, Express India.com, June 27, 2007.
81 Emma Chanlett-Avery and Bruce Vaughn, Emerging Trends in the Security Architecture in Asia: Bilateral and Multilateral Ties Among the United States, Japan, Australia, and India, CRS Report for Congress, January 7, 2008, p. 15.
82 Hillary Clinton stated on the U.S. strategy in Asia that
Washington will work with historic allies andemerging nations. US-Asia Relations. Indispensable to Our Future, Remarks at the Asia Society,
New York, February 13, 2009.
83 Bates Gill, Michael Green, Kiyoto Tsuji, and William Watts, Strategic Views on Asian Regionalism,
Survey Results and Analysis, Washington, DC: CSIS, February 2009, p. 8.
84 Mark E. Manyin, Michael John Garcia, and Wayne M. Morrison, U.S. Accession to ASEAN’s Treaty ofAmity and Cooperation (TAC), Congressional Research Service, May 5, 2009.
85 Interview with Takashi Terada, June 2009.
86 Statement at the Shangri-La Dialogue, May 29, 2009, http://www.iiss.org/conferences/the-shangri-ladialogue/shangri-la-dialogue-2009/ (accessed July 15, 2009).
87 Remarks of President Barack Obama, Suntory Hall, Tokyo, Japan, November 14, 2009.
88 Ann Capling, The Trans-Pacific Partnership, East Asia Forum, November 23, 2009; Deborah Elms,
U.S. Trade Policy in Asia: Going for the Trans-Pacific Partnership? East Asia Forum, November 26,
2009.
89 This spurred concerns among the conservatives in Japan, as reflected in the editorial of Yomiuri Shimbun on October 26, 2009, entitled East Asian Community Shouldn’t Exclude U.S.
90
Rudd Backs India’s APEC Bid, AAP, November 23, 2009.
91 Action Plan to Advance Security Cooperation based on the Joint Declaration on Security Cooperation
between Japan and India, December 29, 2009.
92 East Asia Forum, http://www.eastasiaforum.org/ (accessed December, 2009).
93 Peter Drysdale, The Asia Pacific Community, Processes, Not Principles: The Base for Regional Architecture, East Asia Forum, June 19, 2008.
94 Akiko Fukushima, Japan’s Perspective on Asian Regionalism, pp. 103-127, in Michael J. Green andBates Gill, eds., Asia’s New Multilateralism, New York: Columbia University Press, 2009, pp. 113-114.
95 Aurelia George Mulgan, Breaking the Mould: Japan’s Subtle Shift from Exclusive Bilateralism toModest Minilateralism, Contemporary Southeast Asia, Vol. 30, No. 1 (2008), p. 64.
96 For example, C. Raja Mohan, India’s Great power Burdens, Seminar, January 2008; Interview with
Jabin Jacob from IPCS on June 24, 2009. Jacob has been identified by the French MOFA as a personnalité d’avenir (young leader).
97 Fumitaka Furuoka, Beatrice Lim Fui Yee, and Roslinah Mahmud, Japan and Asian Values: A Challenge for Japan’s East Asian Policy in the New Century, eastasia.at, Vol. 5, No. 1 (September 2006);
and Kazuo Ogura, Toward a New Concept of Asia – Asia Should Contribute to Global Values, Internationale Politik, Winter 2007.
98 Ibid.
99 A loss of interest on the part of the Obama administration toward India and warmer relations with China
could lead Tokyo to push its partnership with India into the background.
100 David Camroux, p. 563. For details of the Chinese vision, Wu Xinbo, Chinese Perspectives on Building an East Asian Community in the Twenty-First Century, in Michael J. Green and Bates Gill, eds.,
Asia’s New Multilateralism, New York: Columbia University Press, 2009, pp. 55-77.
76

45

46

Regional organization

Ultimate objective in theregionJoint Statement, Towards Japan-India Strategic and Global Partnership, December 15, 2006

The New Asian era: emerging A new surge: strengthening of economic
as the leading growth center linkages, initiatives for greater regional inof the global economy.
tegration as well as multilateral trade liberalization.
Need concerted efforts to translate these developments into an Arc of Advantage andProsperity.

Common values

Stability and economic development; invigorate current
dynamism in Asia

Tradition of profound inter- Contribute towards the stabil- D e m o c r a c y a n d m a r k e tchanges from time immemori- ity and prosperity of Asia.
economy, spirit of tolerance,
al; the wisdom to benefit fromreceptivity to diversity.
the distinctive characteristics oftheir civilizations and cultures.

Historical and culturalreferences

To realize an East Asian Com- Nations sharing common valmunity and work together ues and principles
to promote the vision of an
Asian Economic Community
as an Arc of Advantage andProsperity. The Japanese side
conveyed its decision to support India’s membership in the
East Asian Summit.

Japan-India Partnership in a New Asian Era: Strategic Orientation of Japan-India Global Partnership, April 29, 2005

To find a way to cope with the arc of instability and cooperate to realize an arc ofadvantage, referred to by Prime Minister
Singh.

Japan-India Summit Meeting (Summary), November 29, 2004

Asia

Japan-India Joint Declaration, December 10, 2001

JOINT DECLARATIONS“Asia”

Quotations of references to Asia, regional organization in Asia, cultural and historical references to bilateral relations, the ultimate objectives ofJapan and India in the region, and the common values of the partners.

Appendix
ANALYSIS OF JAPAN-INDIA JOINT STATEMENTS AND (SOME) JAPANESE AND INDIAN DIPLOMATIC SPEECHESON BILATERAL RELATIONS

47
To foster the EAS as a pil- The Ministers reaffirm that
lar of East Asian community there exist common objectives and values between thebuilding in the future.
idea of Arc of Freedom
and Prosperity proposed by
Japan and the idea of Arc of
Advantage and Prosperity
proposed by India.

The partnership between Japan and India[ ] is an essential pillar for the future architecture of the entire region.
Japan and India should actively cooperate
to promote multi-layered frameworks anddialogues for regional cooperation in Asia.
They shared the view on the usefulness of
having dialogues among Japan, India, andother like-minded countries in the AsiaPacific region on themes of mutual interest.

Establishing an East Asian Japan and India share univercommunity in the future.
sal values of democracy, open
T h e E A S c a n e s s e n t i a l l y society, human rights, rule
contribute in the process of of law, and market economy;
community building based on they share interests in prouniversally recognized values, moting peace, stability, andand in enhancing the role of prosperity in Asia and in thethe region at the global level. world.

Joint Statement on the Roadmap for New Dimensions to the Strategic and Global Partnership between Japan and India, August 22, 2007

Joint Press Release, Visit of External Affairs Minister of India to Japan, March 22, 2007

While acknowledging the ASEAN as the Japan and India share ancient The progressive realization of India-Japan relation is rooted
driving force [ ], they reaffirm the need for bonds and a proud civiliza- an East Asian community in in similar perception of theall 16 EAS countries to fully participate and tional heritage. Relation un- the EAS framework.
international environment,
actively contribute to the objective of closer encumbered by any historical To pursue a comprehensive converging long-term intercooperation and community building in the differences.
partnership [ ] in open and ests and common commitregion. Promote regional economic integracooperative regional frame- ment to democracy, open
tion further: recall their respective proposals
works.
society, human rights, rule offor a Pan Asian Free Trade Area and for alaw, and free market econoComprehensive economic Partnership inmy.
East Asia.
They are natural partners as
The two leaders share the view on the usethe largest and most develfulness of having dialogue among Japan,
oped democracies of Asia.
India, and other like-minded countries in
the Asia-Pacific region on themes of mutualinterest.

48

Bilateral cooperation within Common commitment to demultilateral frameworks in mocracy, open society, humanAsia, in particular the East rights, rule of law.
Asia Summit, ASEAN Regional Forum, and ReCAAP
processes.

Promoting peace, stability, India and Japan share comand prosperity in Asia and the mon values and interests.
world.

It is time for Japan to position A network of FTA, with ASEAN as the hub No negative history. Only Tripartite dialogue between
India from a local power to in the region. Japan’s Asia policy should positive historic memories: Japan, China, and India.
one of the three major pow- be structured around two vectors, namely: interchange between Tagore
ers of Asia.
North to South East Asia cooperation and and Okakura Tenshin, Subhas
The scope of Asia for Japan East to West cooperation among Japan, Chandra Bose, the great anechas also undergone a change: China, and India. Three great Asian pow- dote of Justice Pal.
from East Asia (up Arakan ers to foster stability and peace in the remountains in Myanmar) to gion. Bad historical memories are counterentire Asia (including South balanced by good historic relations between
Asia and India). Due to: eco- Japan and India. --> Tripartite dialogue
nomic globalization, regional between Japan, China, and India.
security issue (proliferationfrom DPRK to Pakistan), andJapan’s security interest (maritime route, intervention inIndian ocean).

Ambassador Yasukuni Enoki, The Japan-India Partnership, Lecture at USI, May 28, 2004

JAPAN AND INDIAN DIPLOMATIC SPEECHES ON BILATERAL RELATIONSJoint declaration on Security Cooperation between Japan and India, October 22, 2008

Support to the EAS as an open, inclusive,transparent and Leaders’ led forum [ ] todeepen regional economic integration towards the progressive realization of an East
Asia Community.

Joint Statement on the Advancement of the Strategic and Global Partnership between Japan and India, October 22, 2008

49
Heritage of Buddhism.

Address by the External Affairs Minister Sri Pranab Muukherjee, at JIIA, March 23, 2007
A pan-Asian free trade area or Common values of democcomprehensive economic part- racy, human rights, and thenership in Asia.
rule of law.

We are democracies, we haverespect for the same humanvalues and history of a very
benign and very positive relationship.

Civilizational neighbours; her- Arc of advantage and pros- As the largest and most deitage of Buddhism, Bodhisena, perity ; Asian economic com- veloped democracies of Asia.
Tagore, Okakura Tenshin; munity.
judgement of Pal.

Age-old spiritual, cultural, and To renew and reinvigorate our Shared commitments to thecivilizational ties; India refused Asian identity, building on the ideals of democracy, peace,
to attend San Francisco peace commonalities of our inter- and freedom.
conference in 1951; separate ests, aspirations, and values.
India hopes to incorporate
peace treaty with Japan inJapanese values of maintain1952; India waived all reparaing harmony and balancetion claims; dissenting judgebetween social traditions andment of Pal (affection andeconomic modernization.
regard); quotation of Okakura
Tenshin.

Shri Shyam Saran, Special Envoy of the Prime Minister in JIIA, January 15, 2007

Prime Minister Singh, Speech to the Japanese Diet, December 15, 2006.

New Asian era.

Manmohan Singh’s Banquet Speech in Honour of Japanese Prime Minister, April 29, 2005

50

It is thus evident that the trilateral interaction of India, theUnited States, and Japan did
not emerge from a decision toforge a new grouping or alliance.

Trilateral cooperation: India, the U.S., and Japan haveshared values and aspirationsof democracies based on therule of law. Also recognizethat democracy and development are not just compatible
but inextricably linked.

The Pacific and the Indian
Oceans are now bringing
about a dynamic coupling
as seas of freedom and ofprosperity. A broader Asia :an immense network spanning the entirety of the Pacific Ocean, incorporating theUnited States of America andAustralia.

He began his speech with a A broader Asia takes shape A discovery of India as aquotation of Vivekananda.
at the confluence of the two partner that shares the same
Okakura, Pal, Chandra Bose, seas of the Indian and Pacific values and interests. Spirit ofTagore. Ashoka, Gandhi. Kishi, Oceans;tolerance in India; sacredness
first Japanese PM who visited Open and transparent, this net- of nature.
India.
work will allow people, goods,
capital, and knowledge to flow
freely.

Confluence of the Two Seas, Speech by Shinzo Abe, Prime Minister of Japan, at the Parliament of the Republic of India, August 22, 2007

The old links between India
and the Asia-Pacific region are
now being revived and revitalized.

Ambassador Ronen Sen’s Address at the CIIS-JIIA Conference Building Strategic Asia – The United States, Japan, and India, June 28, 2007.

51

When the Pacific Ocean Becomes an Inland Sea, Yasuo Fukuda, Prime Minister, May 22, 2008
India will become one of thepillars supporting the future of
Asia.

Consensual statement:
The new government of Japan has declared The concept behind my initia- Only a brief mention of India:
W h o w i l l b e t h e m e m - that it attaches great importance to Asian tive for an East Asian commu- Going forward, we will acb e r s o f m y i n i t i a t i v e f o r diplomacy. The main pillar of this policy nity stems from the philosophy celerate EPA negotiations withan East Asian community. is the initiative for an East Asian commu- of yu-ai.
the Republic of Korea, India,
To that, my answer is - people nity.
and Australia and pursue thewho share these ideals and
The central idea of my East possibilities of EPA negotiadreams.
In my initiative, I propose that countries Asian community initiative is tions with other countries as
sharing a common vision promote coopera- based upon reconciliation and well.
First of all, we need to cooper- tion in various fields. This would be based cooperation in Europe.
ate to prosper together.
on the principle of open regional cooperaThrough this, our region
Second, we must cooperate to tion.
would develop a multi-layeredsave a Green Asia.
network of functional commuThird, we need to cooperate tonities.
protect human lives.
Fourth, we need to cooperatein building a sea of fraternity.

Japan’s New Commitment to Asia – Toward the Realization of an East Asian Community – Yukio Hatoyama, Prime Minister, Singapore, November 15, 2009

Pacific Ocean as an Inland Sea
for: Japan, ASEAN, North andSouth America and Russia.
China and Australia, and new
Zealand. And in my view
this sea also continues beyond
India to connect to the nationsof Middle East
New Japan-China, Japan-ROK
Relations.

Banking on East Asian Integration? Implications of Global Financial
Crisis for Regionalism
1

Bernard Ong

Abstract
This paper examines the impact of the current global financial crisis, sparked by the collapse of the US banking sector in late 2008, on integration efforts in East Asia. Following thefirst wave of regionalism brought about by the Asian financial crisis of 1997-98, it reviews theeffects of the current crisis on the pace of regionalism in East Asia. Through the lens of a neorealist, this paper looks at how the present financial upheaval has influenced foreign policy
calculations and behaviors of countries in relation to its impact on the momentum of East Asian
regionalism. The central argument is that the current global crisis, whose effects on the world
economy are second only to the Great Depression of the 1930s, will not be a catalyst to the integration process in the region. The conditions leading to the first rush of East Asia regionalism
after the Asian financial crisis are not present in the current crisis. Rather than a second wave ofregionalism as seen in the decade following the events of 1997-98, bilateralism is likely to takeprecedence over regionalism as East Asian countries’ preferred modus operandi in responding to
the accelerated rise of China precipitated by the present crisis.

1. Introduction
The current financial upheaval, which started with the collapse of the United States banking sector in September 2008, has had a deep impact on the global financial system. Economies
across the world experienced severe strains to their banking industries causing some governments to nationalize their banks and put in place stimulus packages to reinvigorate their domestic
markets. In a recent article in Forbes Asia, Singapore Minister Mentor Lee Kuan Yew shared his
views that East Asian countries were the hardest hit in the current world crisis.2 Former US Deputy Treasury Secretary Roger Altman wrote in Foreign Affairs that the financial and economic
crash of 2009, the worst in over 75 years, is a major geopolitical setback for the United Statesand Europe.”3 What started as a US banking problem has turned into a global crisis affecting all
countries. Governments across the world from Asia-Pacific to Europe scrambled to assure markets that their banking structures were sound and not in danger of bankruptcies.
To deal with the unprecedented crash of the global financial system, some countries resorted
to using what are perceived as anti-free trade instruments to protect and spur their domestic industries. Their actions appear to vindicate the common retort that economic crises impede regional integration due to the tendency to apply unilateral protectionist measures by member countries. US President Barack Obama, for example, had pushed for a Buy American clause in his
economic stimulus package, requiring new infrastructure projects to use American-made manufactured materials.4 While the clause was eventually softened with a provision that constrained
procurements to be aligned with the United States’ international trade obligations, several US
cities and states were not bound by the rules of the World Trade Organization (WTO) and North
American Free Trade Agreement (NAFTA).5 The Buy America provision led to mounting
calls by manufacturers in Ontario and Quebec for the Canadian government to enforce the use of52

Canadian-made goods on government-funded projects, having lost out on several key US contracts. In another tit-for-tat response, Beijing also announced a Buy China policy in June 2009,
mandating its government procurement to use only Chinese products or services unless they were
not available within the country.6 In an exclusive interview with China Daily on July 15, 2009
during an official visit to Beijing, US Commerce Secretary Gary Locke conceded that it would be
difficult to find the right balance between free trade and protecting domestic companies, especially in tough economic times.”7 These two episodes illustrate how even the world’s superpower
and rising power had to turn their backs to the ethos of free trade in the face of a major economic
downturn.
In Southeast Asia, some analysts have begun to cast doubts on the Association of Southeast Asian Nations’ (ASEAN) plan to create an ASEAN Economic Community (AEC) by 2015,
which was, in better times, already seen as an ambitious target to achieve.8 A case in point isIndonesia’s push for a Buy Indonesia program that directs its civil servants to purchase only
locally made products.9 Malaysian Prime Minister (PM) Najib Razak also announced a doubling of the country’s foreign worker levy in March 2009 to encourage the hiring of locals.10
Such protectionist measures have led ASEAN Secretary-General Surin Pitsuwan to caution that
protectionism will harm ASEAN’s integrated market plan.11 Pitsuwan’s sentiment is echoed by
Asian Development Bank (ADB) President Haruhiko Kuroda who acknowledged at a public lecture in Singapore on June 22, 2009 that we were faced with the rise of protectionism in AsiaPacific and all over the world.”12 It should be highlighted here that the revival of protectionism
cuts across both developing and developed countries. In April 2009, World Bank (WB) President
Robert Zoellick revealed that nine of the Group of 20 (G-20) nations were considering or hadtaken measures to restrict trade in the face of the current economic downturn.13 WTO DirectorGeneral (DG) Pascal Lamy also acknowledged at a General Council meeting in May 2009 thatthe global trading system would face added political strain as the economic crisis heightened protectionist pressures.14
The evidence suggests a creeping disposition among members of both regional and international organizations to embark on unilateral solutions, which are detrimental to regional cooperation and integration efforts in the present crisis. This paper aims to address the pertinent theme:
Will the current global financial crisis present an opportunity or impediment towards East Asian
regionalism?
The second section begins the discussion by taking stock of current literature on the effects
of global crises on geopolitical and economic interactions. With the benefit of hindsight, the analysis looks into the implications of the Asian financial crisis of 1997-98 for the progress of East
Asia regionalism. The findings show a broad consensus that the Asian financial crisis has hastened the pace of regionalism in East Asia with a slant towards ASEAN-centric regional forums.
The third section proposes a theoretical framework to examine the implications of the current crisis for regional cooperation in East Asia. It highlights the dearth of a system-level theory
to appraise the impact of global crises on regionalism before surveying the effects of the current
financial turmoil on regional cooperation through the lens of a neo-realist. The main thrust of the
discussion is that global crises could narrow the disparity of capabilities among countries, andhasten the rise of new powers. The accelerated change in the distribution of capabilities among
countries will influence a state’s foreign policy calculations, including its decision on the formsof regional cooperation.
The fourth section accounts for the shifting distribution of capabilities in the present crisis
between the United States and China. It addresses the pertinent question of how this defining
event will impact East Asian integration. The results suggest that the crisis has hurt Americans
more than Chinese, and that current efforts by China to reduce its reliance on the United States
could be seen, in a wider context, as a more assertive China with greater foreign policy options.
53

The section then highlights how the rest of East Asia, as secondary states, have responded to theaccelerated rise of China, and how this would impact the destiny of East Asian regionalism in thenext decade.
This paper is primarily focused on the impact of the present global crisis on the integrationof East Asia. Historically, developments of worldwide consequence such as the 9-11 terror attacks have the ability to reshape the international geopolitical and economic landscape. Pollack
makes a more definitive assertion that future regional strategic patterns will be driven by events.15
In the words of Jayasuriya, economic crises unsettle prevailing entrenched interests and regionalarrangements while providing opportunities for new reformist coalitions to form.16 The findingsof this paper suggest that the present crisis will not lead to a second wave of regionalism in East
Asia as seen during the Asian financial crisis.

2. Literature Review
Notwithstanding the conspicuous shift towards protectionism in the current crisis as highlighted in Section 1, there is another school of thought that purports that economic catastrophes
could hasten regional cooperation. A 2007 Organization for Economic Cooperation and Development (OECD) report indicated that the Asian financial crisis of 1997-98 had acted as a trigger
for enhanced financial cooperation in Asia, especially in the area of finance and Foreign Direct
Investment (FDI).17 The underlying assumption is that countries understand the interdependenceof their economies and realize that survival depends on their willingness to work as a regionalgrouping to overcome the economic downturn. This group of scholars maintains that crises playa catalytic role in developing a sense of common identity, particularly in the image of a regionin adversity besieged by outsiders.”18 In support of their case, they explain that the economic upheaval of 1997-98 has propelled ASEAN countries’ pursuit for solutions to reduce the effects ofthe financial disruption, as well as their subsequent alignments with China, Japan, and South Korea through the ASEAN+3 platform.19 The most important outcome and often-cited achievementof the region in the post-crisis period was the creation of the Chiang Mai Initiative (CMI) announced by the finance ministers of ASEAN+3 in May 2000. The Asian financial crisis was also
seen as a stimulus which kick-started regional discussion on the ASEAN Bond Market Initiative(ABMI) and Asian Currency Unit (ACU), among others.
In addition to the concerted accomplishments by the region at the institutional level, there
was also a noticeable spike in the number of Free Trade Agreements (FTAs) established in the
post-crisis period. Urata, for example, points to the active formation of Regional Trade Agreements (RTAs) among Asian countries since the early-2000s, and concludes that the Asian financial crisis has led to an awareness of the need for regional cooperation, such as a region-wide
FTA, to avoid another crisis and promote economic growth.20 Several analysts were also quick
to highlight that the proliferation of RTAs during the post-crisis period was significant given that
China, Japan, and South Korea were not parties to any FTAs up to the 1990s.21 By contrast, China
expedited the negotiation and conclusion of the ASEAN-China FTA shortly after the Asian financial crisis, which was to be followed by the ASEAN-Japan and ASEAN-Korea FTAs.
A mention should be made here about China and Japan’s considerations in the formation of
the ASEAN+3 grouping. China’s unequivocal support of an East Asian institution in the postcrisis period was expected given its interest to further enhance its prestige in the region after its
initial loan offers to crisis-affected countries and resistance to devalue the yuan. Chinese assistance was seen as free coals in cold weather and heightened its influence in East Asia.22 On theother hand, Japan’s decision was less straightforward because it had not supported Malaysia’s
suggestion for an East Asian Economic Caucus (EAEC) that excluded Japan’s staunchest ally,54

the United States, in 1992. Terada attributes Japan’s policy shift to its realization that a consensus
had developed that the time was ripe to create East Asian regionalism to tackle regional problems, and that the United States was not critically opposed to the ASEAN+3 institution.23
More significantly, observers like Dittmer underline that the events of 1997-98 have led to ashift in the focus of regional cooperation from wider Pacific Rim organizations such as the AsiaPacific Economic Cooperation (APEC) to all Asian forums including the ASEAN Plus groupingsand bilateral FTAs.24 That ASEAN countries have moved closer to their Northeast Asian counterparts, especially with China, was, in part, due to the United States’ poor leadership during thefinancial meltdown. The United States’ nonchalant response led to a widespread perception thatthe country could not be depended on during a crisis. There was a strong resentment among someEast Asian countries against the Washington Consensus of rapid deregulation and privatization, which underpinned the International Monetary Fund (IMF) policy prescriptions for crisisaffected countries.25 The conditions associated to the financial rescue packages laid down by the
US-backed IMF were deemed too severe, especially in Indonesia. Furthermore, the US veto ofJapan’s proposal for an Asian Monetary Fund (AMF) on grounds that it would undermine IMF’s
efforts and allow wayward governments to postpone reforms was interpreted as an attempt by theUnited States to maintain its hegemony in Asia. The lesson for East Asian countries was that they
could not count on outside assistance during a crisis.
The current body of literature reflects a general consensus that the economic collapse of
several East Asian economies during the crisis of 1997-98 paved the way for regional cooperation. The study also suggests that the region has resorted to self-help in the absence of strong
leadership from the United States. The post-crisis period also witnessed ASEAN becoming thecenterpiece of an accelerated East Asian regionalism through the ASEAN+3 framework. East
Asian countries have come to the realization that regional cooperation insulates them from global
shocks and reduces their economic dependency on the United States, as well as Europe.
Turning to the current crisis, a few emerging studies suggest that the ongoing financial turmoil has reshaped the international financial and economic order. Henning, for example, argues
that the US banking catastrophe presents an opportunity for Asia to bolster financial cooperation
by enhancing regional surveillance and policy dialogue.26 Among the first initiatives proposed,
ADB President Kuroda mooted the idea of an Asian Financial Stability Dialogue (AFSD) tostrengthen regional ties among finance ministers, central bankers, and other supervisory agencies.27 The AFSD will enable Asian governments to develop a coordinated plan of action to monitor potential vulnerabilities and internalize regional spillovers. In addition, an Economist reporthighlights that China is using the current financial upheaval to boost its strategic influence inAsia.28 At the time of writing this paper, available analyses on the present crisis tended to focus
on the causes of the US banking crisis and how it led to the current global financial meltdown
rather than looking at the influence of such external shocks on states’ foreign policy considerations on regional cooperation—what this paper has set out to achieve. The remaining discussion
therefore aims to address the following question: In light of the present worldwide economic
crunch, will East Asia experience a second wave of regionalism in the next decade as seen after
the Asian financial crisis?

3. Theoretical Framework
Current research on global crises offers few theoretical explanations on how a catastrophic
economic event can influence the momentum of regionalism in East Asia. Calder proposes a
critical juncture framework to account for how the Asian financial crisis has called into question
the existing geopolitical arrangement, and led to an urgent stimulus for change among East Asian55

countries.29 Critical junctures, as defined by Calder, are historical decision points at which there
are clear alternative paths to the future.30 Broadly summarized, crises galvanize national governments in taking steps to forge closer economic cooperation.
On the other hand, Beeson describes the post-crisis collaborative phenomenon as reactionary regionalism, which is defined as the direct result of regional initiatives designed to mediate
and moderate external influences, especially the US policies in East Asia.31 According to Beeson,a key motivating factor was the possibility that regional institutions might have the potential
to provide collective regional responses to external challenges.32 This framework is similar to
Wade’s assertion that post-crisis policy responses could only be understood by examining therole played by the United States as the world’s leading international financial actor.33 The UnitedStates has been instrumental in inducing East Asian governments to undertake rapid financial
opening and liberalization, without which market integration in the region would not have beenpossible.34 Wade’s proposition is corroborated by Ito’s second-level research on the behaviorsof firms in the post-Asian financial crisis period. Ito’s findings suggest that market-led integration of production and investment was responsible for the process of East Asian regionalism.35
Diverse economic conditions in terms of wages and technology in the post-crisis period madeit possible for firms in East Asia to enjoy the advantages of an extensive cross-border divisionof labor, which in turn motivated firms to lobby governments to seek lower trade barriers. Urata
also characterizes the nature of regional economic integration in this region as market-driven
rather than institution-driven regionalization by explaining that it is trade and FDI liberalization
policies, rather than the formation of RTAs, that prompted integration in East Asia.36 This viewis shared by Otsuji and Shinoda who contend that regionalism in East Asia is driven largely bymarket forces in the form of substantial FDIs by the Chinese, Koreans, and Japanese, as opposed
to political will.37
What could be inferred from Beeson and Wade’s hypothesis is that East Asian regionalism
during the post-crisis period was made possible only because of pressures applied by the UnitedStates and its financial intermediaries such as the IMF and WB. On balance, however, criticaljunctures and reactionary regionalism could not explain why RTAs and ASEAN+3 took center
stage in East Asian regionalism over other forums in the aftermath of the Asian financial crisis.
The current body of literature on crises does not adequately explain how an economic catastrophe influences the degree of interaction among states or why they turn toward or away from cooperation in times of crisis. Will the decade following the current crisis lead to a second wave ofEast Asian regionalism as it did after the Asian crisis of 1997-98? If so, will the post-crisis architecture of East Asian cooperation follow that of the post-Asian financial crisis, viz., favoring andaccelerating the ASEAN+3 cooperation, the ASEAN-China relationship in particular, over otherforums such as APEC?
The theoretical basis of this paper is founded on Waltz’s neo-realist interpretation of international relations. Using a system theory, Waltz defines international politics as a structure
comprised of units with three characteristics, namely, (i) an ordering principle which is anarchy(all states are equal); (ii) each unit performs similar functions; and (iii) changes in distribution ofcapabilities across units affect the structure of the system.38 Waltz’s theory needs no introduction
here, except for a brief elaboration on the third principle, which forms the thrust of this paper.
According to Waltz, the structure of a system changes with changes in the distribution of capabilities across the system’s units. And changes in structure affect expectations about how theunits of the system will behave and about the outcomes their interactions will produce.”39
This paper argues that global crises, such as the current global financial turmoil, have thecapacity to reorganize the distribution of capabilities among states, especially those of the UnitedStates vis-à-vis China. The change of distribution of capabilities, whether perceived or actual,
will affect foreign policy calculations of secondary states, which will, in turn, influence their be56

haviors and interactions. That China is a rising power that will challenge US supremacy is not a
new observation, but the key theme here is that global crises have the ability to expedite the riseof a superpower-to-be. The hastened structural change at the system level will affect how East
Asian countries behave and interact with one another.
This hypothesis, if true, will lead to two observable state behaviors. First, rising powers
will seize the opportunity of a global crisis to reduce their dependency on the superpower in an
attempt to move away from a unipolar world. Second, secondary states will exploit these external shocks to maximize their interests, as Waltz argues that secondary states, if they are free tochoose, flock to the weaker side; for it is the stronger side that threatens them.”40
At first glance, it would seem counter-intuitive to suggest that Waltz’s theory of international relations offers an explanation for the pace of regionalism in East Asia in the present crisis—to
apply a political framework to an economic event. However, this paper takes a strong assumptionthat economic might equates to power as many scholars have likewise purported. Ikenberry, forexample, notes that state power today is ultimately based on sustained economic growth. Cox
also asserts that the economy is the foundation stone of all viable empires.41 While the UnitedStates could wage wars in Middle East without the endorsement of the United Nations (UN) following the 9-11 attacks in the security realm given its military might, its economy was too intertwined with the rest of the world’s, especially China’s, for Americans to undertake any unilateral
economic actions. Moore therefore concludes that US policy options are increasingly constrainedby the interdependence of its ties to East Asia, especially in economic affairs.42 Section 4 illustrates the drifting capabilities of the United States vis-à-vis China and suggests that the latter hastaken bolder steps to move away from a unipolar world. It then addresses the pertinent questionof how the rest of East Asia has responded to a more assertive China in the present crisis in relation to the likelihood of a second wave of East Asian regionalism.

4. Accelerated Shift in Distribution of Capabilities
The late Chinese leader, Deng Xiaoping, said in the early 1990s that China should hide
its capabilities and bide its time.”43 This section describes how the US banking crisis has reconfigured the calculations of East Asian countries on the capabilities of the West, especially theUnited States vis-à-vis China. It maintains that while China has been hurt by the present crisis,
its economic and financial power has been strengthened relative to those of the West, especially
the United States. No longer content with hiding its capabilities in the present crisis, China has
assumed a more assertive posture in its dealings with the United States and the wider East Asian
region.
(1) The Crisis Hurts the United States Much More Than China
The US banking crisis has been described as the most destructive 30 years of finance inworld history.”44 The IMF attributed US$2.7 of the US$4.1 trillion global losses in this crisis to
the United States.45 Countries that depended on exporting to the US market were the most affected. For instance, the Wall Street Journal reported that the economies of the three largest trading
partners of the United States, namely, Japan, Germany, and Mexico, plummeted since the onset of
the global recession.46 At the macro-level, the WB highlighted that the OECD economies, which
accounted for 71 percent of the world’s Gross Domestic Product (GDP) in 2007, had shrunk by
4.2 percent in the first quarter of 2009 from a year earlier.47 The United States and Japan alone
contributed to 0.9 and 1 percent of that decline respectively. By contrast, the WB raised the GDP
forecast for China from 6.6 to 7.2 percent in 2009, and expected the Chinese economy to grow 7.7
percent in 2010.48 When asked for their estimates of China’s GDP in 2009 at an interview with57

McKinsey & Company in May 2009, four leading Chinese economists projected the Chinese
economy as growing within the range of 7 to 9 percent in 2009, representing only a slight decline
from its average of 9.7 to 9.8 percent in the past 30 years.49 True to their forecasts, the Chinese
economy grew by 7.9 and 8.9 percent respectively in the second and third quarter of 2009.50 The
impressive comeback posted by China a year into the crisis drew a prompt admission by a Merrill Lynch economist that China’s recovery is real, strong, and sustainable.”51 Summing up the
impact of the banking crisis, Nobel Prize-winning economist Paul Krugman said that the UnitedStates risks a Japan-style lost decade of growth.”52 With the US dollar in steep decline and the
US financial system in crisis, most economists agree that the United States’ financial prowess
will wane over time.
At the micro-level, US multinational companies such as American International Group(AIG), Lehman Brothers, General Motors (GM) and the like, which at one time were considered
prospective challengers to usurp the traditional role of the state, collapsed one after another like adeck of cards. The implication and reputational damage to the United States cannot be understated. Bank of America (BoA), for example, was forced to sell its stake of China Construction Bank
(CCB) in January 2008 and again in May 2009 to boost its own capitalization, a move which
reduced its holding of the prominent Chinese bank from 30 to 11 percent.53 Likewise, Citigroup
had to sell off its holdings of Nikko, one of Japan’s top three securities groups, less than three
years after gaining a foothold in the Japanese market.54 In a ranking of the world’s best banks, theEconomist assesses that the Chinese banks now dominate the standing by market capitalization.55
Outside of the finance sector, a July 2009 Fortune report also named 43 Chinese companies in
its list of the world’s 500 largest companies for the first time, registering a sharp increase fromonly 8 Chinese companies a decade ago.56 While there were still 140 US companies on the list,
2008 marked the worst year in history for the United States’ largest companies with Wal-Mart
displaced from its pole position by a non-US company for the first time. Furthermore, as the list
was based on the operating revenue of companies in 2008, it is expected that the ranking next
year will show a further weakening of US economic prowess when the full force of the crisis on
US companies in 2009 is factored in. A Bloomberg report in July 2009 affirmed that the Chinese
stock market might surpass the US market as the world’s largest by value within three years.57
Both the micro and macro examples reinforce the point that the current financial turmoil has
a disproportionate impact on the capabilities of the United States vis-à-vis China. China is wellplaced to ride out the crisis, which has, in turn, expanded its foreign policy options. By contrast,
the economic and ensuing reputational damage to the United States, as well as the collapse of
its once powerful commercial enterprises, are not to be taken lightly. McKinsey & Company
surmises that the United States’ role in the world economy, and its leadership of capitalism anddemocracy, as well as moral authority, have been severely weakened.58 The United States recognizes its own dwindled position relative to the Chinese, as well as the shifting distribution of
its capabilities in the current crisis. During an official visit to Beijing in June 2009, US Treasury
Secretary Timothy Geithner conceded that China is playing a very important stabilizing role in
the international financial system.”59 But how exactly have the Chinese responded to their accentuated dominance?
(2) China Is Seizing the Opportunity to Reduce Its Reliance on the United States
According to Waltz, a change in the distribution of capabilities across the system’s units
changes the structure of the system. As the international structure alters, so does the extent ofinterdependence.”60 If Waltz’s hypothesis holds true, we will observe China attempting to breakaway from the status quo by seeking measures to reduce its dependence on the United States andexert greater international influence.
Waltz considers two or more countries as interdependent if the costs of breaking their re58

lations or of reducing their exchanges are about equal for each of them.”61 This definition aptly
describes the current state of the US-China relationship. The Chinese State Administration of
Foreign Exchange (SAFE), responsible for investing China’s US$2.27 trillion in currency reserves (as of November 2009), conceded that the financial crisis had struck a heavy blow to theinternational prestige of the dollar.”62 However, approximately 70 percent of the Chinese reserves
are held in US dollar-dominated assets.63 The Chinese are in a Catch-22 situation because sellingaway the US-dominated assets will further depress their overall market value and hurt the Chinese even more. In a revelation of China’s growing concern about the security of its US assets,
PM Wen Jiabao conceded that the Chinese had lent a massive amount of capital to the UnitedStates and called on the United States to guarantee the safety of China’s assets.64 The sudden
flurry of Chinese anxieties following the onset of the US banking crisis compelled Secretary Geithner to give the assurance that Chinese assets [in US dollar-denominated investments] are verysafe in an address to Peking University.65
Yet the Chinese have taken steps in the last few months to reduce their reliance on the US
dollar. According to Yu Yongding, Head of the Chinese Academy of Social Sciences International
Economics and Politics Research Centre, China has done this in three ways, namely by stimulating domestic demand, diversifying funds from US dollar-dominated assets, and making sensible
adjustments to the structure of its US dollar-denominated debt.66 The Chinese government has
unveiled a 4 trillion yuan or US$586 billion package to stimulate the domestic economy, in addition to currency swaps with various countries amounting to US$95 billion that will enable its exports to be settled in yuan. In April 2009, the Chinese State Council also announced that the yuan
could be used in overseas trade settlements in five Chinese cities following a trial run with Hong
Kong, Macau, and ASEAN in December 2008.67 After the first successful completion of crossborder trade deals amounting to 14.38 million yuan by three Shanghai companies in July 2009,
many companies in Singapore, Indonesia, and Malaysia have shown great interest in switching tousing the yuan in their trade.68 These post-crisis measures were clearly aimed at reducing China’s
reliance on the US dollar as its trading currency.
Furthermore, China had been vocal in making a strong pitch for the internationalization of
the yuan in the past six months. Pushing for the replacement of the US dollar as the world reserve
currency is a significant proposition by the Chinese. Traditionally, empires that hold the global
reserve currency are also net foreign creditors and net lenders.69 In a press release issued by Bankof China (BoC) in March 2009, Governor Zhou Xiaochuan attributed the outbreak of the crisis
and its spillover into the entire world to the inherent vulnerabilities and systemic risks in theexisting international money system.”70 Zhou was referring to China’s dependence on the US dollar as the world reserve currency. Calling for reforms to the international monetary system, hefurther proposed for a super-sovereign reserve currency to reduce the risks of a future crisis while
enhancing crisis management capability.71
It should be mentioned here that many experts agree that it will take a long time for the yuan
to be used as a global benchmark, especially since it is difficult to buy and sell yuan outside of
the country. China recognizes this and is realistic about its ability to reduce its reliance on the US
dollar in the near term. Shortly after PM Wen and Governor Zhou’s comments on the stability of
the US dollar, the PRC Ministry of Foreign Affairs reiterated that the US dollar is still the mostimportant and major reserve currency of the day, and the situation will continue many years tocome.”72 In a speech made on behalf of Chinese President Hu Jintao to the Group of Eight (G-8)
in Italy on July 9, 2009, State Councilor Dai Bingguo pressed for reforms to the global financial
system and urged members to maintain the stability of major international reserve currencies, but
stopped short of calling for the replacement of the US dollar.73 Evidently, the Chinese government is avoiding a head-on collision with the Obama Administration, but their overtures, as seen
through the flexing of their economic muscles and heightened lobbying of governments in the59present crisis, reflect a more assertive China setting the stage for a greater role in world politics.
At the inaugural US-China Strategic and Economic Dialogue in July 2009 in Washington, StateCouncilor Dai and Vice Premier Wang Qishan repeatedly reminded their US counterparts of theimportance of ensuring the stability of the US dollar.74
The Chinese government is also making use of the current crisis to augment the country’s
capabilities and search for new opportunities outside of the United States through its Sovereign
Wealth Funds (SWF). At the Boao Forum for Asia in April 2009, Luo Jiwei, Head of China Investment Corp (the main vehicle of Chinese SWF), disclosed that he was considering investingin Europe again now that the European officials have been humbled by the global financial crisis.”75 Through its central bank and SAFE, China has reportedly accumulated assets amounting toapproximately US$22.7 billion worth of shares in various British industries since the onset of thecrisis in 2008.76 It is noteworthy that this sum represents only a small portion of China’s US$2.13
trillion of foreign exchange holdings.
The disproportionate impact of the current financial crisis on the United States and Chinese
economies should therefore be seen in the broader context of a more assertive China that is utilizing the present crisis to reduce its dependency on the United States in an attempt to move awayfrom the unipolar world. The remaining section addresses the pertinent question of how the restof the East Asian countries have responded to the accelerated change in distribution of capabilities between the United States and China.
(3) East Asian Countries Recognizing and Adjusting to the Power Shift
If Waltz’s theory is true, we will observe Southeast Asian countries again moving closer totheir Northeast Asian counterparts, especially China, rather than bandwagoning with the UnitedStates. Does this mean that a second wave of regionalism as witnessed in the post-Asian financial
crisis period is in the cards for East Asia?
According to a mid-year UN report in 2009, the recovery of Chinese domestic demand is
expected to enable East Asian economy to enjoy a relatively robust growth rate of 5.6 percent
in 2010.77 The latest field research undertaken by McKinsey & Company reveals that China willhold the world’s fourth largest concentration of wealthy people by 2015.78 The writings of a powerful Chinese economy accentuated by the present crisis are on the wall. Southeast countries are
beginning to realize the shifting distribution of capabilities between the United States vis-à-vis
other powers such as China and, to some extent, Japan. Consequently, the outbreak of the crisis
saw several key ASEAN countries going all out to woo the Chinese on a bilateral basis.
Signaling their intention to end trade in US dollars, Chinese PM Wen and Malaysian PM
Najib announced during the latter’s working visit to China in June 2009 that Malaysia and China
would consider conducting their trade in Chinese yuan and Malaysian ringgit for the first time.79
Burdekin explains that even if the yuan is not yet ready to take on a greater role in Asia at thisjuncture, the absence of other obvious contenders within the region suggests that this is the mostviable long-term option.80 Such comments mark the genesis of an East Asian awakening to thegrowing might of China accentuated by the present crisis. At the same meeting with PM Wen
in Beijing, PM Najib even offered a commercial banking license to China’s central bank on thecondition that the Chinese would reciprocate by allowing Malaysia greater access to China’s financial and banking sector.81 PM Najib's gesture was highly significant during this crisis giventhat no foreign commercial banks had obtained approval to operate in Malaysia for more than adecade.82 Malaysia’s rejuvenated pursuit of the Chinese market on a bilateral modality is not at
all surprising given that the country is China’s largest trade partner among the ASEAN countries,
with trade value amounting to US$39.06 billion in 2008.83
Likewise, Thailand is redoubling its efforts to deepen its economic relations with China. In
the face of a domestic crisis with pro-Thaksin supporters, Thai PM Abhisit Vejjajiva went ahead
60

with a state visit to China in June 2009, leading a 300-member strong contingent comprised ofgovernment officials and businessmen to Beijing. Both premiers officiated the signing of anagreement to formalize a five-year trade deal between China and Thailand. During the visit, PM
Abhisit went so far as to extend an invitation to PM Wen for Chinese companies to participate
in the infrastructure projects in Thailand made available by the Thai government’s 1.4 trillion
baht economic stimulus plan.84 This is an unusual and unprecedented proposition by the Thais
given that stimulus packages are mostly intended to spur domestic industries rather than overseas
companies. In Singapore, the de-facto investment arm of the government, Temasek Holdings, divested its entire stake of BoA in the United States at an estimated loss of US$3 billion in the firstquarter of 2009, and explained that it would like to focus on global companies that aim to growin Asia.”85 It is telling that, in the same period, Temasek Holdings raised the value of its investment foray in the Chinese banking sector through the purchase of a bigger stake in CCB, which
has become the world’s second-largest lender by market value.86
The emerging evidence indicates that key members of ASEAN have attempted to deepen
their bilateral relations with China in the current crisis, cultivating the Chinese markets by using
the government-to-government approach. Separately, the largest market of ASEAN, Indonesia,
is seeking closer ties with Japan. Following Japanese Finance Minister Kaoru Yosano’s offer forJapan to guarantee US$5 billion of bonds sold by developing countries in Bali on May 3, 2009,
Indonesia announced that its seven banks would auction US$500 million of samurai bonds or
yen-dominated notes with the support of Japan as yet another indication of the waning interestin the US dollar.87 What is common in the examples presented thus far is that ASEAN countries
are tending towards the use of bilateralism to respond to the hastened rise of China in the present
crisis. Yung warns that East Asian regionalism is at risk of evolving into an isolated region, shallowly integrated, with China as the center.88 Apart from the manifestation of a Southeast Asianpenchant for bilateralism rather than regionalism in the present crisis, the issues to consider here
are three-pronged, namely, leadership in Northeast Asia, Chinese growing interest to cultivate
other regions, and political uncertainties in East Asia.
First, China has stepped up its cultivation of the ASEAN countries with the aim to harness
a stronger leadership role in the region. That ASEAN’s FTAs with South Korea and Japan wererealized much later than the ASEAN-China FTA reinforces the view that China is acutely awareof its increasing importance in the region and how it may use that importance to fulfill its leadership aspirations in East Asia. Shortly after the ASEAN Summit in Pattaya in April 2009, Chinese
Ambassador to Indonesia Zhang Qiyue met with Secretary-General Pistuwan to follow up on PM
Wen’s eight proposals on strengthening the ASEAN-China cooperation, including the signing ofa US$10 billion ASEAN-China Investment Agreement to promote infrastructure development in
the region,89 and the provision of US$15 billion credit to ASEAN countries.90 Explaining that thecurrent global crisis is likely to spur further integration among Asian markets, Dominic Barton,
Director of McKinsey’s Shanghai Office, suggests that the current global financial problems provide the leadership in this region a unique opportunity to pull together.91 However, what Barton
has critically failed to point out is that leadership is not a given matter in East Asia.
The intense competition for regional leadership, especially in light of the weakened US
position in the present crisis, will be a major impediment to the deepening of East Asia regionalism or creation of an East Asian FTA. Evidently, no FTAs involving the three Northeast Asian
countries have been concluded. For example, in a bid to fob off recent calls made by China to use
the yuan as the world reserve currency, Japan counter-offered a 6 trillion yen loan to financiallystricken Asia to entrench the yen as the region’s currency for trade in May 2009.92 The offer,
which came just a month after Governor Zhou’s announcement, was on top of the 3.8 trillion yen
Japan had committed to the revised Chiang Mai Initiative Multilateralization (CMIM), which ostensibly also matched the Chinese obligation. The unprecedented push by Japan for Asian coun61

tries to take up yen-dominated loans is a testament to what Urata describes as an intense rivalry
among East Asian countries, especially China and Japan, in a race to assume a leadership role in
the region.93
The rivalry could also be observed during the negotiation of ASEAN+3 finance ministers
on the components of the CMIM, aimed to pool together regional foreign reserves amounting to
US$120 billion by the end of 2009.94 While China, Japan, and South Korea agreed to contribute
80 percent of the fund based on a 2:2:1 ratio, a high-ranking Thai official disclosed that negotiations appeared to be heading nowhere until the ASEAN countries asked Japan and China to contribute equal amounts to the CMIM funding.95 On top of its CMIM commitments, Japan initiateda new currency swap agreement with Indonesia amounting to 1.5 trillion yen (US$15.7 billion) in
July 2009.96 Unlike the CMIM agreement that will be carried out in US dollars, the Japan-Indonesia swap agreement is denominated in yen. These two examples again illustrate how China andJapan are jostling for regional leadership in East Asia. Furthermore, the stalemate is accentuatedby what Pempel describes as a strong US resistance to any forms of regionalism in Northeast
Asia and the wider East Asian region.97
Second, the crisis has presented China with foreign policy options beyond East Asia. Amako
has pertinently observed that Chinese policymakers have begun to move toward the idea ofturning East Asia into a regional space that reflects China’s intentions and interests in the last
decade.98 Yet China is acutely aware that market integration can raise the vulnerability of thehost economy. There will therefore be an increasing bias of the Chinese government towards
a diversification of trading partners and export destinations. For example, China has started to
expand its basket of FTAs to include more non-East Asian countries. Since late 2008, China has
conducted FTA talks with countries like Chile, Costa Rica, Norway, and Pakistan, and concluded
a FTA with Peru in April 2009.99 Since the onset of the crisis, China has also signed a series ofaccords for future cooperation with Russia including some in the areas of natural gas and coal
during President Hu’s state visit to Moscow in June 2009.100 Chinese Foreign Minister reportedly
indicated to the new Indian Foreign Secretary Nirupama Rao that China was ready to work with
India to promote bilateral relations.101
It is worth a mention here that non-Asian countries are as eager to court the Chinese, especially after seeing how economies in the West were badly affected by the global financial crisis.
The Chinese, in turn, are playing their cards right. Their Ministry of Commerce, for example, hasassured the African continent that the world economic crunch will not affect China’s aid to Africa. At the same time, the financial crisis has given China the opportunity to go global by securing
strategic assets at fire-sale prices such as those in the mining sector of South Africa.102 Separately,
President Hu and Brazilian President Lula da Silva issued a joint communiqué on May 19, 2009
to further promote trade and bilateral economic cooperation between Brazil and China, which
had also replaced the United States as Brazil’s top trade partner in April 2009.103 After the issuance of the Brazil-China joint communiqué, Brazilian officials revealed that the governors of thetwo countries’ central banks would be meeting soon to discuss replacing the US dollar with theyuan in their trade transactions.104 Finland and China also concluded a series of high-tech contracts worth US$1 billion, and kick-started discussion for trade deals amounting to US$2 billion
during Chinese Vice-Premier Li Keqiang’s visit to Helsinki in June 2009.105 During a working
visit to Beijing, Hungarian Foreign Minister Peter Balazs asserted to his Chinese counterpartthat developing relations with China was a priority for Hungary.106 The evidence therefore suggests that the Chinese have accelerated their charm offensive in the present crisis from Africa andScandinavia to emerging markets in Eastern Europe and Latin America. The coming months willattest to even more Chinese advances into the non-East Asian region.
Third, the initial postponement and last-minute cancellation of the 14th ASEAN Summit andth
4 East Asia Summit in April 2009, when anti-government protestors stormed the meeting venue62

in Pattaya, highlighted the importance of domestic stability in Southeast Asia for any effective
regional collaboration to take place. It has been acknowledged that ASEAN’s role in brokering
East Asian cooperation is central to the first wave of regionalism after the Asian financial crisis. Mahbubani, in his recent book, goes so far as to say that ASEAN’s remarkable diplomaticachievement is enabling the peaceful emergence of new Asian powers like Japan, China, andSouth Korea.”107 PM Abhisit’s Democrat Party is still locked in an intense political standoff with
pro-Thaksin supporters. As the current ASEAN chair, Thailand’s looming domestic crisis does
not bode well for the Southeast Asian grouping. In Malaysia, the Barisan Nasional governmentis still picking up the pieces after its heavy loss of five Malaysian states to the opposing coalition led by Anwar Ibrahim during its General Elections last year. Turning to Indonesia, President
Susilo Bambang Yudhoyono was compelled to make many political accommodations by awarding key cabinet positions to members of the fringe political parties who had supported his reelection bid in October 2009; more than half are career politicians as opposed to technocrats or
professionals.108 Moreover, the new cabinet, led by President Susilo’s Democrat Party, has to face
off with its longstanding ally Golkar, now the de-facto opposition party. Presidential and legislative elections are also expected in the Philippines in mid-2010, during which President Gloria
Arroyo will step down as the Filipino constitution prohibits an elected president from seeking asecond term. Such domestic uncertainties, coupled with the age-long issue surrounding Myanmarthat has returned to the fold of international attention in recent months with the trial of Aung San
Suu Kyi on charges violating the terms of her house arrest, do not augur well for the next waveof regionalism.

5. Conclusion
At an interview with Reuters in May 2009, the prophetic economist, Nouriel Roubini, whofamously predicted the current banking crisis in 2006, suggested that the US recession would lastfor two years.109 His forecast was substantiated by credit rating agency Standard & Poor’s (S&P)
estimation that the US banking crisis might end in 2013.110 At first glance, the current crisis presents an excellent window of opportunity for East Asian countries to redouble their efforts increating the next wave of regionalism as seen in the decade after the Asian financial crisis of the
1990s. However, given the findings of this study a year into the crisis, this paper is less sanguine
about the second wave of regionalism in the near term.
The conditions that led to the first wave of cooperation after the Asian financial crisis of
1997-98 no longer exist in the current crisis. Section 2 has shown that the need to create a regional institution to meet the challenges of the Asian financial crisis, as well as the widespread perception of unhelpful US leadership, was largely responsible for East Asia’s push towards greater
regional cooperation during the Asian financial crisis. As summarized by Thomas, the subsequent
five years saw an explosion of new regional meetings between officials and ministers from every
sector, which created a stronger sense of community between countries in ASEAN+3.111 Such
conditions are not present in the current crisis.
The recurring theme of this paper is that the present crisis has accelerated changes to the
distribution of capabilities between the United States and China. Premised on Waltz’s theory ofinternational relations, the conceptual framework presented in Section 3 suggests that the recent
US banking crisis has propelled the rise of China, affording the country wider foreign policy alternatives.
Section 4 has demonstrated how the structural change at the system-level has caused ASEAN countries to intensify their efforts to seek closer ties with China through the bilateral track,as opposed to using the regional platform. As highlighted by Leifer, the balance of power in Asia63

is alive and well.112 In his recent book, Beeson makes a parallel case for the declining importanceof the American economy in East Asia, arguing that China may come to be seen as a force forstability in the global economy while the United States will be cast as a source of instability inthe aftermath of the current financial crisis.113 Likewise, China has geared up its efforts to diversify its trade links with non-East Asian countries in the present crisis. Even the United States is
cognizant of the rise of China and its implications. US State Secretary Clinton conceded that theUnited States was seeing particularly China come in right behind us, because countries get tiredof talking to our bureaucracy and decide that they’re going to cut a deal with someone else.”114
Adding to the preference for bilateralism displayed by ASEAN countries (and China) less than ayear into the present crisis, competition for leadership in Northeast Asia and continued uncertainties in several ASEAN countries are not favorable conditions for the next wave of regionalism.
Despite the somewhat dismal findings on the likely pace of regionalism in this paper, there
is a silver lining on the horizon that could substantially change the landscape of East Asian cooperation and warrant further research. Following Singapore’s chairmanship of APEC in 2009, thenext two years will see Japan and the United States taking turns to host the annual APEC Meeting. A year into the US banking crisis, the recently concluded APEC leaders’ meeting in Singapore called on its member economies to resist protectionism and accelerate regional integration.115
Evidently, Japan and Singapore are close allies of the United States, and the latter has long beenpushing for a regional arrangement that encompasses more countries so that no large country
may dominate any regional discussions. Despite celebrating its 20th anniversary this year, APEC
has regrettably been widely perceived as an institution that is in relative decline when comparedwith emerging forums such as the ASEAN+ groupings, leading to recent calls for a broader regional framework. Notably, Japanese PM Yukio Hatoyama is pressing for the establishment of an
East Asia Community based on the spirit of fraternity and friendship, and on the principle of open
regional cooperation, which will cover a broad range of areas such as finance, trade, investment,
and education.116 On the other hand, Australian PM Kevin Rudd is pushing for the fruition ofhis proposed Asia-Pacific Community which seeks to bring together in a single institution the
countries in the region to encourage the habits of cooperation on all areas of concern, ranging
from socio-cultural to economic and political by 2020.117 Differing views about their membership and roles in the region notwithstanding, both leaders have not ruled out the inclusion of theUnited States in the proposed grouping.
Of vital consideration here is the rekindled US interest in the region. On his return from his
four-nation tour of Asia in November 2009, President Obama conceded to the importance of the
Asia market, explaining to Americans that a 5 percent increase in US exports to the region would
result in the creation of hundreds of thousands of jobs for Americans in the current economic
downturn.118 Indeed, prior to his Asia tour, the US accession to the Treaty of Amity and Cooperation in July 2009—a cornerstone of the ASEAN grouping that had been largely ignored by theBush Administration—along with Secretary of State Clinton’s participation in the ensuing ASEAN Regional Forum were among the earliest indications of Washington’s intention to increase
its engagement in the region. Furthermore, President Obama made an unprecedented decision toreverse the Bush Administration’s policy of shunning Mynamar in order to step up and increase
our [US] engagement with ASEAN, in the words of US Ambassador for ASEAN Affairs Scot
Marciel.119 On November 15, 2009, President Obama met with Myanmar Prime Minister Thein
Sein, along with the nine other ASEAN leaders, marking the first ever meeting for the 42-year
old grouping with a US President.120
In what was yet the clearest signal of Washington’s renewed interest in the region, in his major policy speech in Tokyo in November 2009, President Obama repeatedly referred to the UnitedStates as a nation of the Asia Pacific, and even addressed himself as America’s first Pacific
President.”121 In the same address, President Obama asserted that the United States expects to64

be involved in the discussions that shape the future of this region, and to participate fully in appropriate organizations as they are established and evolve.”122 Developments in the past year havecertainly attested to the new engagement strategy of the United States with the region as a whole,in stark contrast to its longstanding modus operandi to cultivate key allies on a bilateral basis.
It is perhaps ironic that this milestone policy adjustment on Asia by the world’s superpower istaking place at a time when countries in this region are turning towards bilateralism in light ofthe current financial upheaval, as this paper has discussed. Sustained leadership from the Obama
Administration and coordinated maneuverings with its allies are critical to invoke the next waveof regionalism whether through a revitalized APEC, Asia-Pacific Community, or East Asia Community.

Notes
This paper was prepared for the Summer Institute on Asian Regional Integration, August 3-8, 2009,
organized by the Global Institute for Asian Regional Integration (GIARI) under the Waseda University
Global COE Program. The author would like to thank GIARI for the opportunity to present his findings
and participate in the Summer Institute.
2
East Asians Hardest Hit in World Crisis, Forbes Asia, June 8, 2009.
3 Roger C. Altman, The Great Crash, 2009: A Geopolitical Setback for the West, Foreign Affairs, Vol.
88 (January/February 2009), pp. 2-5.
4
Obama Risks Flap on ‘Buy American’, Wall Street Journal, February 4, 2009.
5
The Peril of ‘Buy American’, New York Times, June 3, 2009.
6‘Buy China’ Policy Set to Raise Tensions, Financial Times, June 15, 2009.
7
Let’s Get the Balance Right, Says Locke, China Daily, July 16, 2009.
8
Crisis Will Spur ASEAN Economic Integration, The Business Times, February 24, 2009.
9
New Idea to Boost Economy, The Jakarta Globe, February 27, 2009.
10
HR Minister Wants Doubling of Foreign Worker Levy Delayed, The Star, March 25, 2009.
11
Global Crisis a Hurdle to Economic Integration, The Jakarta Post, February 27, 2009.
12 Haruhiko Kuroda’s reply during the Question & Answer Session, Public Lecture organized by the Institute of Southeast Asian Studies on Asia’s Recovery from the Global Financial Crisis – What It Takes
and What Could ADB Do? in Singapore, June 22, 2009.
13
World Bank Leader Warns G-20 Not to Restrict Trade, The Straits Times, April 25, 2009.
14
More in WTO Support an Early Doha Deal to Tackle Protectionism, The Business Times, May 28,
2009.
15 Jonathan D. Pollack, The Asian Security Order, in David Shambaugh, ed., Power Shift: China andAsia’s New Dynamics, Berkeley, California: University of California Press, 2005, pp. 342-343.
16 Kanishka Jayasuriya, Introduction: The Vicissitudes of Asian Regional Governance, in Kanishka
Jayasuriya, ed., Asian Regional Governance: Crisis and Change, Abingdon, Oxon: Routledge, 2008, p.
3.
17
Fostering Regional Integration: Peer Review in Southeast Asia, OECD Report, May 2007, p. 3.
18 Hidetaka Yoshimatsu, The Political Economy of Regionalism in East Asia: Integrative Explanation for
Dynamics and Challenges, New York: Palgrave Macmillian, 2008, p. 16.
19 Yoshihiro Otsuji and Kunihiko Shinoda, Evolution of Institutions and Policies for Economic Integration in East Asia: History and Prospects, in Masahisa Fujita, Satoru Kumagai, and Koji Nishikimi,
eds., Economic Integration in East Asia: Perspectives from Spatial and Neoclassical Economics, Cheltenham: Edward Elgar Publishing Limited, 2008, p. 112.
20 Shujiro Urata, Institutionalization of Regional Economic Integration in East Asia, GIARI Working
Paper, December 2008, p. 22.
21 Motoshige Itoh, The Integration Process in East Asia: Japan’s Experience and Policy Agenda, in
Duck-Koo Chung and Barry Eichengreen, eds., Fostering Monetary & Financial Cooperation in East
Asia, Singapore: World Scientific Publishing, 2009, p. 147.
22 Long Guoqiang, China’s Policy of Opening Up in the Decade After the Asian Financial Crisis, inWang Mengkui, ed., China in the Wake of Asia’s Financial Crisis, Abingdon, Oxon: Routledge, 2009, p.
1

65

70.
Takashi Terada, Japan and the Evolution of Asian Regionalism, GIARI Working Paper, December
2007, p. 17.
24 Lowell Dittmer, The Asian Financial Crisis and the Asian Development State, Asian Survey, Vol. 47,
No. 6 (2007), pp. 830-833.
25 Hidetaka Yoshimatsu, Japan and East Asia in Transition: Trade Policy, Crisis and Evolution, and Regionalism, New York: Palgrave Macmillan, 2003, p. 140.
26 C. Randall Henning, US Financial Crisis, Spillover to Asia, and Opportunities for Asian Regionalism,
paper presented to the 22nd Asia Pacific Roundtable in Kuala Lumpur, Malaysia, June 3-5, 2008, pp.
1-10.
27 Haruhiko Kuroda, High-Level Conference on Financial Crisis, Global Economic Governance, and Development, Keynote Address in New Delhi, India, February 6, 2009.
28
A Time for Muscle-Flexing, The Economist, March 19, 2009.
29 Kent E. Calder, Critical Junctures and Northeast Asian Regionalism, in Kent E. Calder and Francis
Fukuyama, eds., East Asian Multilateralism: Prospects for Regional Stability, Baltimore: John Hopkins
University Press, 2008, pp. 16-25.
30 Ibid.
31 Mark Beeson, ASEAN Plus Three and the Rise of Reactionary Regionalism, Contemporary Southeast Asia, Vol. 24, No. 2 (August 2003), pp. 251-268.
32 Mark Beeson, Regionalism & Globalization in East Asia: Politics, Security, and Economic Development, New York: Palgrave Macmillan, 2007, p. 12.
33 Robert Wade, The US Role in the Long Asian Crisis of 1990-2000, in Arvid John Lukauskas andFrancisco L. Rivera-Batiz, eds., The Political Economy of the East Asian Crisis and Its Aftermath, Massachusetts: Edward Elgar Publishing Limited, 2001, pp. 196-197.
34 Ibid., p. 221.
35 Itoh, The Integration Process in East Asia: Japan’s Experience and Policy Agenda, p. 153.
36 Urata, Institutionalization of Regional Economic Integration in East Asia, p. 2.
37 Otsuji and Shinoda, Evolution of Institutions and Policies for Economic Integration in East Asia: History and Prospects, p. 108.
38 Kenneth Waltz, Theory of International Politics, Reading, Massachusetts: Addison-Wesley, 1979, pp.
101-102.
39 Ibid., p. 97.
40 Ibid., p. 127.
41 Michael Cox, Is the United States in Decline – Again? International Affairs, Vol. 83, No. 4 (2007), p.
651.
42 Thomas G. Moore, The Changing Face of American Power, in Nicholas Thomas, ed., Governanceand Regionalism in Asia, Abingdon, Oxon: Routledge, 2009, pp. 215-216.
43
China’s Deng Dictum on Korea-to-Climate Dangers Imperiling G20, Bloomberg, April 20, 2009.
44
Subprime Crisis Was Unleashed by Bank-shielding Policymakers, The Japan Times, May 25, 2009.
45
IMF Put Financial Losses at $4,100 Billion, The Financial Times, April 21, 2009.
46
World Economies Plummet, Wall Street Journal, May 21, 2009.
47
Leading Economies Report a Period of Record Decline, International Herald Tribune, May 25, 2009.
48
World Bank Raises China GDP Forecast, Financial Times, June 18, 2009.
49 McKinsey Global Institute, Is China Recession Proof, The McKinsey Quarterly, May 2009.
50
China 2010 GDP Growth Seen at 8.5 Percent, Reuters, November 15, 2009.
51
Domestic Demand Offsets Fall in Exports, The Straits Times, July 17, 2009.
52
US Risks ‘Lost Decade’ Due to Half-Steps: Krugman, Reuters, May 11, 2009.
53
China Construction Bank Downplays Bank of America Sale, Xinhua, May 14, 2009.
54
Now Nikko Citigroup to Be Sold, The Japan Times, April 14, 2009.
55
The World’s Best Bank: A Short List, The Economist, May 23, 2009.
56
43 Chinese Companies Join the Ranks of the Fortune 500, Xinhua, July 10, 2009.
57
China ‘to Overtake Wall Street in 3 Years,’ Bloomberg, July 18, 2009.
58 Allen P. Webb, Weighing the US Government’s Response to the Crisis: A Dialogue, The McKinsey
Quarterly, June 2009.
59
Geithner Says Beijing Has Confidence in US, Wall Street Journal, June 3, 2009.
23

66

Waltz, Theory of International Politics, p. 144.
Ibid., p. 143.
62
Geithner to Reassure China Over Its US Debt Investments, The Business Times, May 29, 2009.
63
Where Did All the Yuan Go? The Business Times, May 29, 2009.
64
China’s Leader Says He is ‘Worried’ Over US Treasuries, New York Times, March 13, 2009.
65
Geithner Tells China Its Dollar Assets Are Safe, Reuters, June 1, 2009.
66
Where Did All the Yuan Go? The Business Times, May 29, 2009.
67
New Move Takes Yuan Closer to Global Status, China Daily, April 20, 2009.
68
Yuan Trade Pilot Scheme Kicked Off, China Daily, July 7, 2009.
69
The Almighty Renminbi? New York Times, May 13, 2009.
70
Reform the International Monetary System, Xinhua, March 26, 2009.
71 Ibid.
72
China: US Dollar to Remain Dominance for Years, China Daily, July 6, 2009.
73
China Urges Actions to Reform Global Financial System, Xinhua, July 9, 2009.
74
Chinese Convey Concern on Growing US Debt, Wall Street Journal, July 29, 2009.
75
China Set to Invest Again in Europe, The Financial Times, April 19, 2009.
76 Michael Heng and Lim Tai Wei, Destructive Creativity of Wall Street and the East Asian Response, Singapore: World Scientific Publishing, 2009, pp. 162-163.
77
China to Bolster East Asia Economy: UN Report, Xinhua, May 28, 2009.
78 Yuval Atsmon and Vinay Dixit, Understanding China’s Wealthy, The McKinsey Quarterly, July 2009.
79
Malaysia, China Consider Ending Trade in Dollars, Wall Street Journal, June 4, 2009.
80 Richard C. K. Burdekin, China’s Monetary Challenges: Past Experiences and Future Prospects, New
York: Cambridge University Press, 2008, p. 226. Burdekin also observes that the yen has been declining
in importance worldwide due to Japan’s longstanding economic weakness.
81 Bernama, Najib: China’s Trip Was Fruitful, June 5, 2009.
82
Malaysia Issues China’s ICBC Local Banking License, Agence France Presse, November 21, 2009.
83
China Raises Four-Point Proposal on Tackling Financial Crisis with Malaysia, Xinhua, June 3, 2009.
84
High Hopes Rise on China Trip, Bangkok Post, June 25, 2009.
85
Temasek Sells Entire Stake in Bank of America, Financial Times, May 15, 2009.
86
China Construction Bank Says Temasek to Raise Stake, Reuters, March 30, 2009.
87
Indonesia Picks 7 Banks for Samurai Bond Sale, The Business Times, May 28, 2009.
88 Yung Chul Park, Economic Liberalization and Integration in East Asia, New York: Oxford University
Press, 2006, p. 244.
89
China’s Proposals on Co-operation with ASEAN Appreciated, China Daily, June 1, 2009.
90
China Rolls Out Aid Package for ASEAN, Xinhua, April 12, 2009.
91 Dominic Barton, Asia’s Future and the Financial Crisis, The McKinsey Quarterly, December 2008.
92
Tokyo Aims to Push Yen Over Yuan in Asia, Asahi Shimbun, May 5, 2009.
93 Urata, Institutionalization of Regional Economic Integration in East Asia, p. 22.
94
Regional Cooperation Vital to Asia’s Recovery, Xinhua, May 6, 2009.
95
Tokyo Aims to Push Yen over Yuan in Asia, Asahi Shimbun, May 5, 2009.
96
Indonesia, Japan Ink Fresh 1.5 Trillion Yen Swap Deal, Jakarta Post, July 7, 2009.
97 T.J. Pempel, The ‘Unbungling’ of Asia, Global Asia, Vol. 3, No. 4 (2008), p. 78.
98 Satoshi Amako, The Idea of New International Order China Is Seeking and an East Asia Community,
GIARI Working Paper, December 2007, pp. 6-7.
99
China Hopes FTAs Will Help Boost Exports, China Daily, May 15, 2009.
100
China, Russia Ties Must Flourish in Crisis, Bangkok Post, June 17, 2009.
101
China Vows to Advance Bilateral Ties With India, Xinhua, July 14, 2009.
102
China’s Investment Expansion in South Africa ‘Only Beginning’, Xinhua, July 15, 2009.
103
China, Brazil Pledge Closer Ties on Trade, Economy, People’s Daily, May 20, 2009.
104
China Bolsters Brazil Trade Ties, Financial Times, May 19, 2009.
105
Finland, China in $3 Billion High-tech Deals, China Daily, June 26, 2009.
106
Developing Relations with China Is Hungary’s Priority, Xinhua, July 4, 2009.
107 Kishore Mahbubani, The New Asian Hemisphere: The Irresistible Shift of Global Power to the East,
New York: Public Affairs, 2008, pp. 83-85.
108
Indonesia’s New Cabinet Sworn In, Indo Asian News Service, October 22, 2009.
60
61

67

Roubini Says US Economy May Dip Again Next Year, Reuters, May 28, 2009.
US Banking Crisis May Last Until 2013, The Business Times, May 15, 2009.
111 Nick Thomas, Towards an East Asian Community: Implications of the EAVG Report, in Kanishka
Jayasuriya, ed., Asian Regional Governance: Crisis and Change, New York: Routledge, 2004, p. 189.
112 Michael Leifer, Truth about the Balance of Power, in Chin Kin Wah and Leo Suryadinata, eds., Michael Leifer: Selected Works on Southeast Asia, Singapore: ISEAS Publications, 2005, pp. 152-154.
113 Mark Beeson, Institutions of the Asia-Pacific, Abingdon, Oxon: Routledge, 2009, p. 81.
114
Speed Up Aid or Lose Clout: Clinton, The Straits Times, April 25, 2009.
115
2009 Leaders Declaration – ‘Sustaining Growth, Connecting the Region’, APEC Secretariat, November 15, 2009.
116
Japanese PM Renews Commitment to Asia, The Straits Times, November 16, 2009.
117
Address to the APEC CEO Summit by Australian Prime Minister Kevin Rudd in Singapore, Department of the Prime Minister and Cabinet, Australia, November 14, 2009.
118
Obama Calls For More US Exports to Asia, Wall Street Journal, November 21, 2009.
119
Obama to Meet Leaders of Myanmar, Other Southeast Asian Nations in Singapore, Associated Press,
November 7, 2009.
120
Obama Meets Myanmar PM, Calls For Suu Kyi’s Release, Reuters, November 15, 2009.
121
Remarks by President Barack Obama at Suntory Hall, Tokyo Japan, Office of the Press Secretary,
The White House, November 14, 2009.
122 Ibid.

109
110

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The Nexus between Traditional and Non-Traditional Security
Cooperation in Japan-China Relations: Environmental Security and theConstruction of a Northeast Asian Region

Christian Wirth

Abstract
This paper aims to contribute to the understanding of regional international relations bylooking at bilateral and multilateral security cooperation. It focuses on the two major East Asianstates, Japan and China. Mostly limited to questions of traditional security, Japan-China relations are often characterized as the result of a power shift, contentions about history or conflicting identities. However, since the 1990s, dynamics of globalization are dramatically changing
and complicating the socio-economic and political environment in East Asia. It is thus necessary
to analyze regional and bilateral security cooperation comprehensively. This paper therefore
seeks to explain the nexus between questions of traditional and non-traditional security in JapanChina relations. It evaluates policy coordination through bilateral and multilateral channels in
the areas of environmental security against the background of their overall security-political relationship since the mid-1990s. In this regard, the study analyzes the development of cooperation
within the frameworks of the Tripartite Environment Ministers Meeting (TEMM) and the Northwest Pacific Action Plan (NOWPAP). Subsequently, it assesses the proposition that cooperationin areas of non-traditional security is politically easier to realize than cooperation in the area of
traditional security, and that such functional cooperation is conducive to the improvement of international relations through the building of political trust. Finally, the study aims to contributeto the understanding of how dynamics of globalization transform the nature of international relations and influence the course of future regional cooperation in East Asia.

1. Introduction
Over the past decades, waves of economic development caused a surge in intra-regional
trade flows, which led to a certain degree of division of labor between East Asian countries andto the emergence of nascent regional structures. More importantly, the spread of similar patternsof increasing economic production and consumption, as well as other dynamics of globalizationsuch as the accelerating spread of new means of telecommunication and transportation, are rapidly changing socio-economic conditions in Northeast Asia. Subsequently, social, energy, maritime, environmental, and human security issues became part of the political agendas. Given theirtransnational character, all of these developments foster the expansion of interests and practices
beyond established boundaries.1 Despite steadily growing interdependence, however, regional
political cooperation has remained modest. Mutual distrust continues to hinder further integrationof communities and prevents effective solutions to transnational security challenges. Most striking is the lack of collective action due to the complicated relations between the two major actorsof the region, Japan and China.
By looking at Japan-China security relations, this study shall contribute to the understanding of regional cooperation in Northeast Asia. It analyzes the interplay between the manage69

ment of traditional security policy on the one hand and non-traditional security on the other.
While traditional security involves the prevention and defense from attacks by organized, statecontrolled armed forces, non-traditional security encompasses a wide range of threats to nationaland human security as well as the responses to them. Similar to neo-functionalist explanations of regionalism, it is often argued that East Asian regional cooperation in response to nontraditional security concerns is politically easier to achieve than cooperation in traditional security matters.2 The main argument is that non-traditional security threats create imperatives forstates and political communities to work together in order to solve the problems affecting theirstability. Moreover, it is argued that cooperation in areas of non-traditional security in functional
issues contributes to the building of political trust and therefore leads to enhanced international
security-political cooperation. Other reasons might be that relevant issues are not associated withdeliberate, targeted, and sudden state action which threatens the core national security interests ofanother state, that is, territorial and political control.
In the context of globalization and its important impact on East Asian states and societies,
an important puzzle arises, involving the interlinking of non-traditional security problems andtraditional national security concerns. This problem leads to the following questions: How did
Japan-China cooperation in the area of non-traditional security develop since the mid-1990s compared to cooperation in areas of traditional security? Did the nature and quality of cooperationin non-traditional security differ from cooperation in traditional security? If so, what accounts
for the differences? And why did cooperation in areas of non-traditional security happen in somecases and not in others?
Rapid industrialization and changing patterns of consumption as hallmarks of East Asiandevelopment lead to the increasingly salient depletion of natural resources and are the sourcesof transboundary air and ocean pollution. Therefore, environmental security—the focus of thepresent study—is of particular importance to regional cooperation.
This paper argues that, provided a basic political will, environmental security cooperation
can serve as a diplomatic tool to develop and improve bilateral relations in the security-politicalsphere. The analysis of two cooperation mechanisms reveals that inter-governmental cooperation
at the working level is fraught with various problems of collective action ranging from questionsof financing and transparency to governing capacity. Despite the limited progress of environmental security cooperation at the working level, however, the study concludes that cooperative rhetoric and symbolic action, which put other countries in a positive light, are able to build politicaltrust between states and societies. As a result of the growing awareness of the need for environmental protection, the fact that Northeast Asia is ecologically a region translates into enhanced
political regional cooperation.
The argument is presented as follows. The second section of the paper clarifies the conceptof security and discusses its application to environmental problems. The third section elaborates
on how non-traditional security cooperation may lead to the improvement of political relations.
The fourth section outlines the development of the security-political relationship between Tokyo
and Beijing to be used as a benchmark. The fifth section explores environmental security cooperation in Japan-China relations at the high diplomatic level. The sixth and seventh sections assess
environmental security cooperation at the ministerial and working levels by looking at the casesof the Tripartite Environment Ministers Meeting (TEMM) and the Northwest Pacific Action Plan(NOWPAP). The final and concluding section assesses the proposition that environmental security cooperation is conducive to the improvement of bilateral relations and subsequently leads tobetter regional cooperation in Northeast Asia.

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2. Security as Stability of Social Order
In order to operationalize the concept of security, it is necessary to answer the questions
about the referent of security and the range and nature of threats that are of concern. The
conceptualization of security developed by Buzan, Waever, and De Wilde3 explains how specific issues become objects of security politics and analysis. An actor describes a problem or aphenomenon as something exceptional that is existentially threatening a specific referent object.
The argument is that emergency measures that go beyond the common political process willneed to be taken. The success of these securitization moves in the form of speech-acts, mostly
performed by political actors, depends on whether the audience accepts it and adopts the threat
perception. According to this definition, security is of a subjective quality and is essentially a
product of communicative interaction. Caballero-Anthony et al.4 point to the importance of closer
analysis to determine why securitization occurs and how it takes place. This analysis includes
questions about the motives and intentions of securitizing actors as well as the impact of securitization on political outcomes. The fact that certain social groups or individuals are often unable
to voice their concerns in political processes means that securitization may not occur, despite theobjective presence of existential threats to individuals and communities.
This study raises the question of whether the state as referent object is the appropriate unitof analysis. As Dupont stresses, [T]he security of states has no real meaning if divorced fromits human constituents.”5 This is even more so when one tries to define the desirable outcomeof activities to render human communities secure. Camilleri asserts that the critical issue isthe maintenance of a social order that is able to generate sufficient degrees of confidence into
the future.6 Security is therefore a psychosocial condition. In an effort to give the concept
explanatory power despite its multidimensional character, Camilleri, in line with McSweeney,
conversely defines insecurity as related to the experience of social disruption, the fragility ofsocial relationships, the absence of cognitive control over, or affective empathy with, various
forms of human interaction (which obviously include the ecological implications of suchinteraction).”7 Camilleri consequently defines insecurity as the perceived disruption—actualor potential—of the social order. In this paradigm where insecurity is inextricably linked withthe problem of collective identity, nationalism, and the nation-state are modern and far-reaching
responses to the experience of insecurity.8 However, problems such as the lack of capacity andgood governance, as well as the increasing salience of transnational phenomena, challenge theconventional notion of states as single providers of security for their citizen. This is especiallythe case in East Asia, where the distinction between state and government is often blurred, as thelatter itself is constituted by the ruling party. Opposing the ruling party therefore means opposing
the state.9 The resulting priority of the preservation of political power by governments has theimplication that the safety and welfare of citizens, let alone environmental concerns, are ofsecondary importance. As a consequence, there can be no reliable analysis of security problems
without a close look at the underlying social and institutional conditions.
With the development of new concepts of security after the end of the Cold War, it has
become common to speak about environmental security, and globalization is increasingly understood in this context. The main reason is that beginning in the 20th Century, human development is characterized by the enormous expansion of the global population and its movement
into urban areas. As a result, systems have been established to move various commodities fromrural areas to burgeoning cities.10 This phenomenon is especially true for Northeast Asia. The
question is therefore what meaning environmental security has for the authorities in Tokyo andBeijing and how it influences bilateral relations. Empirical evidence does not support the generalargument that environmental security problems lead to interstate conflict. Rather, environmental
degradation does affect local communities and may contribute to domestic instability.11 However,71transnational environmental problems do have high potential to affect the relations between states
adversely.12 In this context, it is useful to look at the securitization of environmental degradation
because it shows how issues become part of political agendas and earn a certain level of priority. Securitization triggers two debates: one about the underlying risk assessment and one about
the strategic answer to it. Moreover, if the security discourse persists, it will result in community
building and institutionalization. De Wilde also notes that in large parts of these discourses, more
often than the environment itself, the preservation of existing levels of civilization is the referent
object. Ultimately, the debate is therefore about which groups (professions, industries, and countries) need to change their behavior in order to render the patterns of consumption sustainable andreduce the threats to common environmental security.13 On this background, Deudney opposes
the securitization of environmental problems and their linking with national security, as he fears
that it would reinforce the us -versus- them thinking, which he sees as inherent to nations andapt to intensify interstate tensions.14
The analysis of official documents and the discourses among opinion leaders in Northeast
Asia reveals that, with the exception of climate change and hydrocarbon supplies, environmental
concerns are securitized only to a very limited extent. Instead, resource scarcity, pollution, andenvironmental degradation are widely understood as technical problems. One reason might bethat the environmental security agenda, due to its dimensions which require the fundamental
change of much of the present global structures in terms of world economy, international system,
and cosmopolitan values, is simply unmanageable.15 Moreover, environmental threats appear invarious shapes and affect communities in different, often gradual ways, and to different extents.
It is therefore difficult to include these phenomena in a consistent securitizing act. Lastly, thoseactors who would be in positions to securitize environmental problems, despite their salience inview of social stability, may not be interested in allowing for any social mobilization out of fear
they may lose some political control.
Despite these drawbacks, the analytical lens of security studies is applied in this research
as it provides a consistent conceptual framework, while also helping to answer the question ofsocial (and political) mobilization with regard to international cooperation. The fact that nontraditional security concerns such as environmental scarcity and pollution are often of transnational character means that transnational and international cooperation is necessary to addressthese common problems. The strict adherence to norms of non-interference and classical understandings of state sovereignty often hinder pragmatic cooperation and even prevent effective
domestic responses. The next section briefly reviews propositions for why and how increasing
interdependence among states leads to stronger intergovernmental cooperation and may weaken
the us -versus- them and inside hierarchic order and security -versus- outside anarchy andinsecurity conceptions of the global system.

3. Explaining Regional Intergovernmental Cooperation
In view of the difficulties in substantially improving the relations between Japan and China
in the area of traditional security due to the lack of political trust, it is often argued that instead of
focusing on the disputed issues only, one should shed more light and devote more effort to areasin which common interests can be identified more easily. It is argued that, by focusing on more
technical questions, there are possibilities to build trust through cooperation that will eventually
spill over into the security-political realm, and also help alleviate politico-military threat perceptions. At the least, such cooperation in East Asian maritime affairs in particular is seen as aneffective confidence and security building measure.16 This perspective becomes salient when theincreasing interdependence of East Asia societies and states is considered.
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The question to be explored is how, and under what conditions political communities areable to improve cooperation between them. Deutsch elaborated on several factors that determine
political integration, understanding ‘state of mind’ or disposition to be cohesive, to act together,and to be committed to mutual programs.”17 The argument that is most often invoked with regard
to East Asia is that of the importance of shared functional interests. In his transactionalist approach, Deutsch points to the necessity of determining the relevance and extent of shared functional interests according to the belief of the people involved rather than on the basis of reality.
Moreover, as functional interests may change, a closer look at the politically dominant interest
groups is in order. Haas’ neofunctionalist approach is best known for the argument that cooperation in one sector generates spillover effects and leads to the deepening and the broadening ofcooperation in other sectors, and eventually makes political loyalties shift to new institutions.18
The weaknesses of the seminal works of Deutsch and Haas that make their approaches difficult
to apply to Northeast Asia are twofold. First, the diversity of political and economic systems in
the region means that the necessary background conditions are partly nonexistent.19 Second, both
approaches, although they do mention ideational factors, neglect the importance of socialization processes, which determine the values and norms held by political communities that consequently affect domestic as well as international integration.20 With regard to security studies,
the second shortcoming means that the interplay between so-called high-politics of traditional
security and the low-politics of non-traditional security can hardly be explained.21 In view ofthe salience of history disputes, territorial disputes, and military modernization that characterizeinternational relations in East Asia, however, the discussion of changes in mutual images, norms
of non-interference and sovereignty, as well as the construction of threat perceptions, is essential
in explaining the lack of collective action.
In order to assess the influence of globalization dynamics on Northeast Asian international
relations and the relevance of non-traditional security cooperation, this paper will first explore if
and why cooperation in non-traditional security issues may be easier to achieve than cooperationin traditional security issues. Second, it seeks to verify and specify how functional cooperation
may increase political trust between two state actors. Functional cooperation, or cooperation in
non-traditional security issues, may be easier to realize between Japan and China because:
1.

2.
3.
4.

5.

6.

it is suitable for individual politicians to serve as diplomatic tools to bring positive
contributions into high-level meetings with their foreign counterparts, and resultsfrom their efforts to show their constituencies;
it is less publicized in the media and is thus less risky for politicians in weak power positions to undertake; and they can sell compromises to their constituencies;
it is less controversial because the concerned issues do not directly affect founding
myths (historical understandings) of a social group and a particular state;compromising in functional areas is not perceived as reducing the state's own
security in view of a threat from the other party, because non-traditional security threats do not originate from deliberate state action. As a result, structural(geopolitical) constraints are largely nonexistent;
it is easier to find non-controversial areas to engage the counterpart, because thepossibilities for technical cooperation far outnumber the contentious issues of traditional security issues; and,technical questions allow it to advance cooperation through small steps because
they are often more complicated and can be deconstructed.

In short, one could ask whether the distinction between non-traditional security cooperationand traditional security cooperation is one of technical, fact-based action versus symbolic, idea73

tional actions of a state. With regard to the second argument to be assessed in this paper, functional cooperation, or non-traditional security cooperation, may build political trust because:A) functional cooperation reinforces the parties’ qualities as partners, equal actors,
and political subjects instead of making one party an object of international politics;B) successful cooperation demonstrates the ability and capacity of a political actor as
a common problem-solver, thereby increasing its domestic and international legitimacy;C) it helps to de-securitize a relationship through technical dialogues, the exchange
and generation of common knowledge, and the dissemination of this knowledge
to increase transparency and predictability;D) it engages, nurtures, and creates cooperative elements (epistemic communities) ofa social group or a state and gives each a bigger role;E) it allows for social mobilization and the strengthening of political leadership without the necessity of the othering of another social group or state; and,F) it increases the amount and the quality of communication between the respective
state administrations.
In order to evaluate the similarities and differences between traditional and non-traditional
security relations, the development of Japan-China bilateral cooperation in the area of traditional
security shall be compared with the area of environmental security as an example of one nontraditional security concern. For the purpose of this research, environmental security is limited
to transboundary ocean and air pollution that affects public health and has detrimental effects on
farming and fishery in neighboring states.22
The sphere of environmental security has been chosen because it is increasing in salience
due to the rapid growth of industrial production and consumption, and because of the enlargementof common markets combined with other systemic dynamics such as population growth, thespread of new technologies, and the increasing mobility of people. It is relevant since it is related
to the ability of the respective societies to meet their basic needs, to secure and improve their living standards, and ultimately to maintain political stability. As a result, environmental issues area significant factor in the bilateral relations between Japan and China. Moreover, national governments as regulators are heavily involved and remain important actors. Lastly, environmental
cooperation is clearly more technical in nature and is purported, for the reasons outlined above,
to offer better opportunities for cooperation between states than issues of traditional security.
In order to strengthen the analytical coherence of the study, the impact of climate change
on international security and international cooperation is excluded because it is of global nature.
Second, the study will not directly discuss the politics of Japanese official development assistance (ODA) to China. The reason is that ODA, as a term describing the way of funding, is aform of cooperation that is largely motivated by material incentives rather than being based on
normative grounds. Thus, such forms of cooperation in which one party is paid for changing its
behavior are less suitable for the assessment of understandings that may lead to policy-changes
in the long-term. The mechanisms of the Tripartite Environment Ministers Meeting (TEMM)
and the Northwest Pacific Action Plan (NOWPAP) are chosen as case studies because they makeit possible to cover three different levels of interaction between the Japanese and Chinese stateadministrations: the head of state (diplomatic), the ministerial, and the working level. Moreover,as indicated below, these mechanisms feature prominently on the foreign policy agendas ofboth Japan and China.23 The cases do not necessarily provide enough evidence to generalize
the conclusions. Nevertheless, the insights help to understand the argument that increasing74

interdependence leads to better cooperation.

4. The Evolution of Cooperation in Traditional Security between Japan and China
In order to make the fields of traditional and non-traditional security comparable, it is
not only necessary to outline the general trends, but also to describe the changing patterns ofcooperation ranging from the head of state down to the working level. With regard to the generaltrends since the mid-1990s, two points are most important. First, the Japanese side is worried
about the modernization drive of the People’s Liberation Army (PLA), which is accompanied andfinancially bolstered by the rapid growth of the Chinese economy. Prime Minister Hashimoto,during his visit to China in September 1997, clearly addressed this concern, which became
more and more pronounced with the continued increases in defense spending, especially in theareas of strategic weapons, the air force, and the navy.24 The Chinese navy’s enhanced activities
around Japan from spring 2000 on, along with the lack of transparency on matters of national
defense, have contributed to rising threat perceptions until today.25 Second, on the Chinese side,
there is a longstanding anxiety over the status of Taiwan. China is equally anxious about thereaction of other East Asian states and the US to the increase of its political and military weight.
In this regard, the development of more active Japanese security policies and the continued
strengthening of the military alliance with the United States are of importance.26
When Prime Minister Hosokawa visited Beijing in March 1994, a series of cooperative
projects in various fields were agreed upon. These plans included the resumption of the defense
dialogues that had been suspended after the Tian An Men incident. Subsequently, bilateral
security dialogues were held annually. These talks continued even through the difficult times
when the tensions between Taiwan and the Mainland strongly affected Japan-China relations, theDiaoyu/Senkaku Islands dispute escalated, the Guidelines for US-Japanese Defense Cooperation
were revised, and Prime Minister Hashimoto visited the Yasukuni Shrine in 1996.
On the occasion of the visit of Chinese Defense Minister Chi Haotian to Tokyo in February
1998, an agreement on defense exchanges was signed with the intention to give the previous
meetings, which were largely symbolic and superficial, more depth and content.27 During Jiang
Zemin’s visit to Japan in November 1998, similar to those in 1994 and 1997, a wide range ofareas of cooperation were identified. Among the so-called thirty-three points were also newproposals for confidence and security building measures in the military sphere. These included
the establishment of a hotline between Beijing and Tokyo through which, in case of an
unforeseen incident, both governments could immediately clarify a critical situation related tonational security with competent authority on the other side. Moreover, mutual port-calls bynaval ships were proposed. The promotion of defense exchanges was again a main point on theagenda when the Chief of the Japan Defense Agency visited Beijing in May 1999. When Prime
Minister Zhu Rongji visited Tokyo in October 2000 amid intense diplomatic negotions on various
issues—such as increased Chinese naval activities, the flaring up of the East China Sea territorial
disputes, tensions between Taiwan and the Mainland, and Japan’s UN Security Council bid—the
hotline proposal had not yet been implemented, although it had been agreed upon in principle
several times before.
Only in 2003, when the Chinese National Defense University and the Japanese National
Institute of Defense Studies started to exchange colonel-class personnel, were the limited plansfor defense exchanges put into practice.28 A prior notice system for ocean research arounddisputed areas in the East China Sea, agreed upon by the foreign ministries in February 2001,
could not prevent confrontations around the Diaoyu/Senkaku Islands. The situation became mostcritical in 2004 and 2005 when the Japan Coast Guard arrested Mainland activists on one of the75

Diaoyu/Senkaku Islands, and Beijing dispatched ships of the People’s Liberation Army Navyto the island group.29 Only after Prime Ministers Wen Jiabao and Shinzo Abe again agreed on
mutual port calls of naval ships and defense exchanges in April 2007 were the proposals datingback to 1998 partly implemented. On the occasion of President Hu Jintao’s visit to Japan in
May 2008, there was an understanding that cooperation between Chinese and Japanese defense
forces should be enhanced in areas such as disaster relief and peacekeeping operations down
to the military unit level. The proposal of hotlines between political and defense authorities ofJapan and China, however, has not been implemented until today. Nor does a memorandum of
understanding (MOU) on search and rescue at sea between Japan and China exist, although theCouncil for Security Cooperation in the Asia-Pacific (CSCAP) encourages littoral states to create
one.30Apparently, cooperation in the area of traditional security is strongly influenced by thechanging state of bilateral political relations. While defense dialogues and exchanges becameslightly more sophisticated over the years, they did not lead to an alleviation of mutual threat
perceptions, and there was no significant progress in the area of security cooperation. When
we explore the causes hindering the establishment of basic confidence and security building
measures, not to mention political compromises to de-escalate tensions and build trust, several
points are worth discussing in order to compare them with obstacles to cooperation in the nontraditional security sphere.
First, given their wartime history, there is a longstanding enmity between the military establishments in both countries, which may in many cases be rooted deeper than those among
politicians, directly translating into threat perceptions and strategic calculations.31 The Cold War
and post-Cold War security order in East Asia did not change these perceptions.32 Second, sincemilitary thinking and planning is designed and tasked to prepare the defense of national security
interests in any contingency, territorial disputes in the East China Sea put the PLA and the Japan
Self Defense Forces (JSDF) automatically in adversarial positions. Third, the prevailing public
opinion of each country toward the other, coupled with the weakness of the incumbent politicalleaders, makes it difficult for politicians to compromise on territorial disputes and other longstanding controversial issues. As a result, there is not much room to improve the situation. The
stalling of the cautious attempt of President Hu and Prime Minister Fukuda in 2008 to separate
the exploration of natural gas in the East China Sea from territorial claims is a good illustrationof this point. Chinese commentators saw the deal as giving in to groundless Japanese claims. An
additional reason, however, may have been the change in political leadership with the election of
Taro Aso to Prime Minster, and the increasing unpredictability due to the lack of political continuity in Tokyo. Fourth, structural (geopolitical) factors seem to inhibit the establishment of bilateral confidence and security building measures as well. In 2008, hotlines between the Chineseand Korean navies and air forces, as well as relevant Chinese and US authorities were set up. In
contrast, different definitions of hotline seem to be the obstacle between Tokyo and Beijing.
Thus, for the Japanese side, Beijing’s desire to include information exchange on JSDF activities
conducted under the US-Japan alliance, such as the prior notice of combined US-Japanese exercises, is not acceptable. On the other hand, the Chinese side has the impression that the Japanese
authorities, due to their strong desire to not upset US interests and instead strengthen the alliance,
show too little flexibility and are thus unable to conclude a reciprocal agreement when it comesto the exchange of information.33
In summary, one is compelled to conclude that in the area of traditional security cooperation, very little, if any substantial progress has been made since the mid-1990s, despite the significant improvement of diplomatic relations from September 2006 on. Against this backdrop, thesignificant cooling down of diplomatic relations around 1996, especially in the period from 2001
to 2006, provides a good frame of reference for a comparison with the evolution of cooperation76

concerning non-traditional security matters.

5. Environmental Cooperation in High-level Bilateral Diplomatic Relations
When Prime Minster Hosokawa visited Beijing in March 1994, the first agreement between
Japan and China on environmental protection was signed. Its main purpose was to establish theJapan-China Joint Committee on Environmental Protection and Cooperation, which serves asa means to exchange views on environmental issues, as well as bilateral and multilateral cooperation in the field. In May 1996, to commemorate the 10th anniversary of the Japan-China peace
treaty, the Sino-Japan Friendship Center for Environmental Protection and the Japan-China
Comprehensive Forum on Environmental Cooperation were established.
At the bilateral summit between Prime Minister Hashimoto and President Jiang Zemin in
September 1997, the project titled Japan-China Environmental Cooperation Toward the 21stCentury was proposed. It consisted of two pillars: the Japan-China Environmental Development Model Cities Plan, and the Project for Improvement in Environmental Information
Network. In his analysis of international relations in East Asia and between China and Japan,
Prime Minister Hashimoto mentioned environmental issues, including climate change, energy
conservation, and trade and investment as particularly important areas for bilateral cooperation.34
Subsequently, in April 1999, the 3rd Joint Experts Meeting selected Guiyang, Chongqing, andDalian as model cities, and the two governments agreed on the exchange of notes in regard to
the portion of the 4th ODA Yen Loan that included related projects. During Jiang Zemin’s visit
to Japan in November 1998, thirty-three points of cooperation, including environmental protection, were agreed upon. Also, as a positive gesture, Jiang brought with him the declaration of full
membership of China in the Japan-sponsored initiative to monitor acid rain deposition in East
Asia (EANET).35 On the occasion of Prime Minister Obuchi's July 1999 visit to Beijing, the Japanese leader proposed the establishment of a 10 billion yen fund in Japan, encouraging Japanesecitizens’ groups and other bodies to engage in greening cooperation in China. The proposal wasmeant to become a third pillar in Japan-China environmental cooperation, together with the two
initiatives undertaken by his predecessors Takeshita and Hashimoto. Japanese assistance to China
in environmental protection continued as the priority of the revised ODA policy implemented in
2001.36 However, environmental cooperation only resurfaced in official statements again, together
with other areas, when Prime Minister Abe visited Beijing in October 2006.37
The plan to promote bilateral relations with environmental cooperation became more concrete when Wen Jiabao visited Tokyo in April 2007. Now, environmental cooperation was declared as one of the main means, and a significant one, to construct a mutually beneficial strategic relationship based on common strategic interests. The Joint Statement on the Enhancementof Cooperation for Environmental Protection included a comprehensive and detailed list of areasand projects in which cooperation should be enhanced. Moreover, the statement explicitly mentioned the Tripartite Environment Ministers Meeting (TEMM), the Northwest Pacific Action Plan(NOWPAP), the Acid Deposition Monitoring Network in East Asia (EANET), and ASEAN+3 as
frameworks to promote regional environmental cooperation. Bilateral mechanisms such as theJapan-China Joint Committee on Environmental Protection and Cooperation, the Japan-China
Comprehensive Forum on Environmental Cooperation, and the Sino-Japan Friendship Center
for Environmental Protection were included as well.38 On the occasion of the visit of Hu Jintao
to Japan in May 2008, a number of cooperation projects related to environmental protection andmanagement were positively mentioned and enhanced cooperation was agreed upon.39 Finally,
when Communist Party of China’s (CPC) Politburo Standing Committee Member Li Changchun(the head of the CPC’s propaganda department) visited Tokyo in March 2009, the main message
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delivered to the public was the call for enhanced environmental cooperation. In addition to thosementioned above, environmental issues were included as items on the agendas of the meetings
between China, South Korea and Japan on the sidelines of ASEAN+3. These included the Tripartite Environment Ministers Meetings (TEMM), the Northwest Pacific Action Plan (NOWPAP),
and others.40
From the analysis of the official press releases, statements, and declarations associated withthe above events, one can conclude the following. First, environmental protection is seen as acommon interest and is frequently put forward as a means to strengthen bilateral and regional
cooperation. Second, when political relations are most tense, environmental cooperation is not
mentioned because there is no will to cooperate, or even communicate. The diplomatic use ofenvironmental cooperation suggests that the impetus required to start major projects presupposesa relatively improved political situation and mutual willingness to advance by changing the basic
framework of bilateral relations. This was the case in 1994, 1998, and 2007, but not during theperiod from 2001 to September 2006. The following sections will look at two cases in order toanalyze the nexus between environmental cooperation and traditional security cooperation at theministerial and working levels.

6. The Tripartite Environment Ministers Meeting (TEMM)
The TEMM mechanism, established in 1999, is the highest level of intergovernmental
cooperation on environment in Northeast Asia. At the annual meetings, the three environment
ministers from Japan, China, and South Korea exchange information, views, and concerns about
regional problems. They also discuss potential measures to address those problems and further
promote environmental cooperation. Additionally, there exists a working group that acts as secretariat and proposal-making body. Recently, an ad hoc working group of the three DirectorsGeneral has also been convened to address dust and sandstorm problems. The priority areas of
TEMM are: (1) raising the awareness that the three countries belong to the same environmental
community; (2) promoting information exchange; (3) strengthening cooperation in environmental research; (4) fostering cooperation in environment-related industries and transfer of environmental technologies; (5) exploring appropriate measures to prevent air pollution and to protect
the marine environment; and (6) strengthening cooperation to address global environmental issues such as biodiversity and climate change. In addition, the scope of meetings was expanded toinclude waste management, chemical pollution, energy, water-related issues, as well as the reconstruction of societies upon sound material cycles and circular economies.41
Over the last ten years, annual meetings were hosted and chaired on a rotating basis. Eachmeeting produced a joint communiqué and identified various projects within the priority areas
listed above. Thus, according to those involved, officials of the three countries have been working closely together and built mutual trust.42 In this respect, personal relationships are explicitly
mentioned as being significant to ensure the sustainability of TEMM. As such, it is probably thepolitically most stable mechanism among the three countries, only comparable to the financeministers meetings.43 Despite the fact that the projects implemented by TEMM have been small
compared to the environmental problems in the region, its importance for concrete outcomes in
the promotion of environmental cooperation in the region is allegedly widely acknowledged.44
A closer look at the joint communiqués of the annual meetings shows that there have been
discussions on various environmental concerns, as well as approaches and initiatives to address
them. Also, the agenda has been expanded to include new and increasingly salient problems suchas marine litter and transboundary movement of hazardous wastes. While the joint communiquéof 2004 reveals that there has been discontent because of the lack of output orientation, effective78

ness and efficiency of TEMM projects, the more recent communiqués all convey the message
that the cooperation at the ministerial level has been good and that TEMM projects have been
output-oriented and effective. The communiqués do acknowledge, however, the need for the promotion of collaborative research, information and data exchange, and the enhancement of specific measures to address environmental degradation in Northeast Asia.45 In order to make TEMM
more efficient and able to contribute more to the management of the regional environment, a
recent tripartite report proposed to lay down basic principles and objectives of TEMM, to set up
a secretariat, to create a body for proposal-making and implementation supervision, to establish afinancial mechanism, and to coordinate project implementation.46
Various programmes and projects undertaken at the national and multilateral level are regularly recognized as important and worth supporting by the three ministers. This includes initiatives such as the COOL BIZ campaign which obliges Japanese government officials to work in
offices with air-conditioning set at 28°C in summer while being allowed to dress less formally.
At the same time, other concerns and programs such as acid deposition, waste management, andocean pollution have been continuously discussed with little, if any, visible progress over theyears. This result suggests that TEMM operates at the lowest common denominator. While thecommissioning of a tripartite research report on environmental management in Northeast Asia
may be seen as an achievement, better coordination among the various initiatives is urgently
needed if substantial progress is to be made.47 This situation has not changed since the publication of previous research.48 Apart from the fact that projects implemented under the auspices of
TEMM are small-scale and mostly limited to the organization of conferences and workshops, itremains questionable whether TEMM has been able to provide political impetus and support for
more substantial projects in priority areas.49 Nevertheless, TEMM seems to be a political-diplomatic success as the working atmosphere between the ministers has been good and constructive,
despite considerable diplomatic tensions between the countries, like those in 2004 and 2005.
TEMM is arguably the most important mechanism for the promotion of environmental
cooperation in Northeast Asia and is an indication of the strong will of the participants to cooperate on matters related to the environment.50 Thus, it can be seen as an umbrella framework
within which other initiatives and projects are conducted. In order to see how the allegedly good
cooperation at the ministerial level translates into effective action, it is necessary to analyze theprogress of specific projects that have been implemented under the political sponsorship of thethree environment ministries. The following section therefore aims to assess the effective output
of environmental cooperation by looking at a project repeatedly mentioned in the TEMM joint
communiqués, the Northwest Pacific Action Plan.

7. The Northwest Pacific Action Plan (NOWPAP)NOWPAP was adopted by the People’s Republic of China, Japan, South Korea, and Russia as part of the United Nations Environment Programme’s (UNEP) Regional Seas Programme
in 1994. This form of cooperation dates back to 1991, when national representatives of the four
countries met in Vladivostok to discuss an action plan for the environmental management of
the Northwest Pacific.51 The overall goal of NOWPAP is the wise use and development of thecoastal and marine environment so as to obtain the utmost long-term benefits for the humanpopulation of the region while protecting human health, ecological integrity, and the region’s sustainability for future generations. More precisely, this plan leads to a strategy for wise management of the Northwest Pacific area which consists of five elements: monitoring and assessmentof the environmental condition; creation of an efficient and effective information base; integrated
coastal area planning; integrated coastal area management; and the establishment of a collabora79

tive and cooperative framework.52
The implementation of the action plan is principally to be financed by the member states'
contributions to a trust fund of at least 400,000 US Dollars (USD) annually. Initial financial andadministrative support was available from UNEP while the littoral states are responsible for theplan’s implementation. The annual intergovernmental meetings (IGM) represent the main governing body of NOWPAP. Moreover, UNEP was aiming for the early establishment of a regional
coordinating unit (RCU) to be responsible for the execution and coordination of the projects under the action plan.
The following history shows the most important steps in the development of the regional
action plan and its implementation. The first IGM in 1994 formally adopted the action plan andincluded the identification of five priority areas. The second IGM in 1996 approved the geographical scope and a tentative scale of contributions to the trust fund for 1997. The fourth IGM
in 1999 led to the agreement on the establishment of four Regional Activity Centres (RAC). The
sixth IGM in 2000 agreed in principle to establish a co-hosted regional coordinating unit (RCU)
in Toyama, Japan and Busan, South Korea. The seventh IGM in 2002 led to a detailed agreement
on a plan for the establishment of the RCU in Toyama and Busan. Moreover, in 2002, the RACs
in Beijing (Data & Information Network RAC/DINRAC), Daejeon (Marine Environmental
Emergency Preparedness & Response RAC/MERRAC), Toyama (Special Monitoring & Coastal
Environmental Assessment RAC/CEARAC), and Vladivostok (Pollution Monitoring RAC/POMRAC) became operational. The technical coordination and information exchange between
the four RAC’s and the RCU on their respective projects, apart from the IGM, is ensured throughso-called national Focal Points Meetings (FPM) held annually by each RAC. The eighth IGM in
2003 adopted the NOWPAP regional oil spill contingency plan. In 2004, the co-hosted RCU was
opened in Busan and Toyama and a Memorandum of Understanding (MOU) on Regional Cooperation Regarding Preparedness and Response to Oil Spills was signed. The tenth IGM in 2005
approved new directions for RAC’s, expanded the geographical coverage of the NOWPAP oil
spill contingency plan, and approved a marine litter activity. The twelfth IGM in 2007 approved,in principle, the draft of a regional action plan on marine litter and the draft text of the NOWPAP
Regional Oil Spill Contingency Plan, expanded to include noxious substance spills. The latter
was formally adopted at the thirteenth IGM in 2008. Most recently, the fourteenth IGM in 2009agreed on the development of a project on the assessment of the current status of marine andcoastal biodiversity in the NOWPAP region.
Looking at the development of the NOWPAP mechanism, we note that steady progress has
been made in terms of organizational development and the implementation of projects. The biggest success of NOWPAP is the MOU on a regional contingency plan in the event of oil and noxious substance spills. Subsequently, oil spill exercises were conducted in the Aniva Bay (Sakhalin)in 2006 by Russia and Japan, and in 2008 near Qingdao with participation of South Korea andChina. The NOWPAP contingency plan went through a reality check when Korean, Chinese,
Japanese, and Russian authorities joined hands to fight the worst ever oil spill in the Korean history, which happened in December 2007 near the port of Incheon.53
A first complication in regional cooperation happened when Japan and South Korea could
not agree on where to establish the regional coordinating unit (RCU). Both countries vied for theleadership and control in establishing NOWPAP. Eventually, its functions were split between abranch in Busan and one in Toyama, and UNEP stayed in charge of it. The most pressing concern, however, was financial. NOWPAP started with the goal of establishing an initial trust fundof $400,000. For the year 2008, the tentative contributions of Japan and South Korea covered
the major shares of $125,000 and $100,000, respectively, while Russia was ready to commit$50,000, and China, $40,000.54 Here, it is necessary to note that Russia did not contribute forabout eight years. Moreover, the operation of the two-site RCU consumes a big proportion of the80

small budget.55 Given the enormous problems with water and air pollution around industrial areas, NOWPAP, focused on environmental protection in coastal areas, is of second or third priority to the Chinese government. This attention may differ from that which Japan and South Korea
attach to the protection of their long coastlines. Moreover, there is a general attitude in China thatdeveloped countries carry greater responsibility and need to take on a bigger burden in environmental protection, since their earlier economic development caused irreversible environmental
damages. As a result, China is willing to increase its contribution proportionately based on theprinciple of common but differentiated responsibilities, if other countries increase their shares.
While Seoul is relatively flexible, Tokyo seems only willing to increase its share if Beijing shoulders a proportionately bigger share.56
When it comes to the technical operation of NOWPAP RACs, the diverging national priorities are also reflected. Japan attaches importance to marine litter and coastal environmental assessment whereas South Korea and China want to focus on alien invasive species in the future.
While this kind of technical discussion is inherent to multilateral frameworks, the differences
grow in salience when the tight budget and unequal cost-sharing are considered. Further, theadministrative structures in each state are prone to complicate national and international cooperation. In China, the Ministry of Environmental Protection is responsible for NOWPAP while
the effective environmental management of coastal and marine areas is in the realm of the State
Ocean Administration, directly subordinate to the State Council and therefore not obliged to report to the Ministry of Environmental Protection. Issues related to sea-traffic, on the other hand,fall into the competence of the Ministry of Transportation’s Maritime Safety Administration(MSA), and the ships of the Fishery Bureau of the Ministry of Agriculture patrol the seas aswell.57 In Japan, the Coast Guard, as part of the Ministry of Land, Infrastructure, and Transport
is comprehensively responsible for the coastal environment and needs to coordinate with the
Ministry of the Environment. The inter-agency coordination problem becomes even more pronounced when considering the important role of local governments in the success of reaching
NOWPAP’s goals. Despite this fact, NOWPAP does not include local governments. It can thus beconcluded that maritime environmental management, which naturally includes coastal areas, is acomplex undertaking, as it requires extensive national and international collaboration. A further
major obstacle to effective environmental management has been the unwillingness, and partly
the inability, of national agencies and the involved researchers to disclose and exchange scientific
data within NOWPAP. This shortcoming is very significant as consensual scientific knowledge is
the indispensable base for any future strategies and projects. Another political issue that affects
the goal of NOWPAP is the absence of North Korea in the framework. Last, but not insignificant,are the difficulties caused by the lack of English language competence among the involved officials.58 According to one source, this limitation stands in contrast to the UNEP Regional Seas
Program covering Southeast Asia, where communication between officials is much easier in thisrespect.
In summary, one is compelled to conclude that the positive rhetoric at high-level meetings between heads of state, prime ministers, and environment ministers, which have very often
stressed the importance of environmental protection and programs such as NOWPAP in particular, has not translated into much action and output at the working level. Although there have been
a number of concrete projects implemented, they remain small scale, are insufficiently coordinated, and suffer from basic problems due to the lack of political will to invest resources and cooperate better. Does this mean that the cooperation in environmental security is meaningless forthe improvement of the security-political relations between Japan and China?

81

8. Conclusion: The Meaning of Environmental Security Cooperation for Northeast Asia
The first part of this section determines whether and why cooperation is politically easierto realize in environmental security issues than in traditional security issues. From the analysis
of high-level diplomatic meetings since the mid-1990s, it can be concluded that environmental
cooperation serves as a diplomatic tool to promote intergovernmental cooperation between
Japan and China. This is possible since there is an understanding that the advancement ofenvironmental protection is a win-win situation for all. In this area, both countries have beenable to find a role that is acceptable to them. While China can learn from Japan’s experienceand technological knowledge to alleviate its environmental problems, Japanese firms areable to sell their products and services while reducing the negative effects of environmental
degradation originating in China and affecting Japan. This kind of cooperation is therefore seen
as mutually beneficial. However, the lack of progress between 2001 and 2006 shows that a basic
willingness for cooperation at the top political level is a precondition for the improvement ofexisting cooperation, as well as for the establishment of new frameworks of intergovernmental
cooperation.
Despite the prevailing mistrust, cooperation in environmental protection may be easier toachieve because it is not considered to be politically sensitive. This means that politicians andbureaucrats who cooperate with the other side are far less scrutinized for the engagement withthe difficult neighbor. One reason is that environmental security cooperation does not touch uponquestions that are linked with the historical understandings that underpin the modern Japaneseand Chinese states.59 Moreover, environmental problems are perceived to be more connectedto the lack of governing capacity than to deliberate hostile action of one state against another.
Cooperation in this field is therefore not seen as potentially harming national security. This may
also be the reason why structural constraints in the form of geopolitical calculations that inhibit
confidence building in the traditional security sphere are affecting environmental cooperationmuch less.
Furthermore, cooperation is most likely facilitated because the area of environmental
protection offers a wide range of potential projects such as those seen in the discussions of thethree environmental ministers at TEMM. These issues are often very technical in nature. As
technicalities are rather complex for the public to understand, and discourses about environmental
security are highly fragmented, it is possible to undertake relatively small cooperative projects
and advertise them in a positive light without the need to take high financial and political risks.
The assessment of the effectiveness and efficiency depends on the small groups of experts
involved, and the possibility to gain an overall picture is even more difficult for the generalpublic. Cooperation projects such as TEMM and NOWPAP, once established, continue to run
despite diplomatic tensions. Only when frameworks of cooperation are to be upgraded, thepolitical dimension comes into play again. As higher authorities need to commit financial andother resources, and review and establish new procedures and understandings of how to relate tothe other side, political concerns start to affect functional cooperation significantly again.
With regard to the question of whether and how environmental security cooperation canbuild trust in the security-political area, a few conclusions may be drawn. As demonstrated above,
the area of environmental security is very useful to engage in cooperative rhetoric and positive(symbolic) action. This tactic may help counter negative images and threat perceptions in thepolitico-security area. Despite the limited output of the few and rather small-scale environmental
protection projects, and the reluctance to exchange scientific data, cooperative action is likely tocontribute to the de-securitization of the bilateral relationship. Because security-political frictions
also are created and reinforced by symbolic and rhetoric action, they can—and probably evenneed to—be improved by symbolic and rhetoric action as well. Instead of depicting the other82

side as a potential enemy or rival, environmental security cooperation helps politicians who arewilling to find a modus vivendi engage in positive identification of the other party as a partner.
There are limitations of this effect, however. In view of the relatively small scale ofcooperative action and the consequently weak environmental management, the proposition thatenvironmental security cooperation reinforces states’ capacity as problem-solvers and allows forsocial mobilization without the othering of one party could not be confirmed by this study. As
soon as environmental problems become bigger and threaten bilateral relations more directly,
calls for output-oriented action on a bigger scale may become louder. Subsequently, conflicts overpriorities and cost-sharing may challenge the cooperative symbolism and limit positive effects
on political relations between neighboring countries. The differences in political commitment,
willingness to bear costs equally, and ability to improve state capacity may also lead to additional
complications. If solutions to new challenges can be found and new roles established, cooperation
may be elevated to higher levels, lead to stronger cooperation, and produce positive spill-overeffects into the political sphere. However, in order to gain reliable insights into such mechanisms,
further research encompassing several case studies in various spheres of functional cooperation
should be undertaken.
Last, it should not be forgotten that this study did not assess one of the outstanding strengths
of cooperation in environmental security, which is the involvement of stakeholders beyond thenational level. Since environmental issues directly concern societies across state boundaries,
the engagement in environmental protection has the potential to bring not only politicians andbureaucrats but also provincial and local governments, as well as civil society actors in contact.
In conclusion, the findings of this study suggest that, given the fact that Northeast Asia
is ecologically already a region, the slowly growing awareness of the need to protect theenvironment is conducive to the political construction of Northeast Asia. First, environmental
security cooperation serves as a substitute for the lack of confidence and security building
measures in the traditional security sphere and contributes to the improvement of JapaneseChinese relations which are central to any region-building project. Second, cooperation inenvironmental management, together with functional cooperation in other areas, can serve as ameans to enhance mutual knowledge among Northeast Asian societies; it also has the potential
to change negative images and roles based on previous and outdated understandings. Third,
environmental security cooperation needs to take into account the imperatives of regional
ecological interdependence, after which it may eventually promote political awareness of theircommon existence in a Northeast Asian region.

Acknowledgements
The author would like to thank the Waseda University Global COE Program, Global Institute for Asian Regional Integration, for its financial and logistical support in his participation in
the Summer Institute on Asian Regional Integration 2009, as well as for the funding of overseas
research. Thanks also go to the anonymous reviewers of the earlier version of this article and toProfessor Tsuneo Akaha for his comments in particular.

Notes
J.N. Rosenau, The Dynamics of Globalization: Toward an Operational Formulation, Security Dialogue, Vol. 27, No. 3 (1996), pp. 247-262.
2 T. Akaha, Non-traditional Security Cooperation in Northeast Asia, in R. Thakur and E. Newman, eds.,
1

83

Broadening Asia’s Security Discourse and Agenda: Political, Social and Environmental Perspectives,
Tokyo: United Nations University Press, 2004, pp. 306-339; M.J. Valencia, Northeast Asia: Navigating
Neptune’s Neighbourhood, in Confidence Building Measures and Security Issues in Northeast Asia,
Stimson Center Report No. 33, February 2000, http://stimson.org/pub.cfm?ID=31 (accessed September
4, 2009); Y. Wang, East Asia Community and Nontraditional Security: A Proposal from China, paper
presented at the Conference on Confidence Building and Peace Building in Asia, Waseda University,
Tokyo, September 23-25, 2005, http://irchina.org/en/news/view.asp?id=404 (accessed November 22,2008).
3 B. Buzan, O. Waever, and J. De Wilde, Security: A New Framework for Analysis, New York: Lynne
Rienner, 1998.
4 M. Caballero-Anthony, R. Emmers, and A. Acharya, Non-traditional Security in Asia: Dilemmas in Securitization, Aldershot: Ashgate, 2006.
5 A. Dupont, East Asia Imperilled: Transnational Challenges to Security, Cambridge and New York:
Cambridge University Press, 2001, p. 229.
6 J.A. Camilleri, The Security Dilemma Revisited: Implications for the Asia-Pacific, in W.T. Tow, R.
Thakur, and I.T. Hyun, eds., Asia’s Emerging Regional Order: Reconciling Traditional and Human Security, Tokyo: United Nations University Press, 2000, pp. 305-322.
7 Ibid., p. 308. See also B. McSweeney, Security, Identity, and Interests: A Sociology of International Relations, Cambridge: Cambridge University Press, 1999.
8 Ibid., p. 308.
9 W.T. Tow and R. Trood, Linkages Between Traditional and Human Security, in W.T. Tow, R. Thakur,
and I.T. Hyun, eds., Asia’s Emerging Regional Order: Reconciling Traditional and Human Security, Tokyo: United Nations University Press, 2000, pp. 13-32.
10 S. Dalby, Security and Environment Linkages Revisited, in H.G. Brauch, ed., Globalization andEnvironmental Challenges: Reconceptualizing Security in the 21st Century, Berlin: Springer, 2008, pp.
165-172.
11 T.F. Homer-Dixon, Threshold of Turmoil: Environmental Scarcities and Violent Conflict, in D.
Deudney and R.A. Matthew, eds., Contested Grounds: Security and Conflict in the New Environmental
Politics, Albany: State University of New York Press, 1999, pp. 61-90; D. Deudney, Environmental
Security: A Critique, in D. Deudney and R.A. Matthew, eds., Contested Grounds: Security and Conflictin the New Environmental Politics, Albany: State University of New York Press, 1999, pp. 187-219.
12 L. Elliott, Environmental Security in Northeast Asia: Defining a Common Agenda, in P.G. Harris,ed., International Environmental Cooperation: Politics and Diplomacy in Pacific Asia, Boulder:
University Press of Colorado, 2002, pp. 31-50.
13 J.H. De Wilde, Environmental Security Deconstructed, in H.G. Brauch, ed., Globalization andEnvironmental Challenges: Reconceptualizing Security in the 21st Century, Berlin: Springer, 2008, pp.
595-602.
14 Deudney, Environmental Security: A Critique.
15 De Wilde, Environmental Security Deconstructed.
16 Valencia, Northeast Asia: Navigating Neptune’s Neighbourhood.
17 K. Deutsch, P.E. Jacob, H. Teune, J.V. Toscano, and W.L.C. Wheaton, The Integration of PoliticalCommunities, Philadelphia and New York: Lippincott & Co, 1964, p. 11.
18 See E.B. Haas, Beyond the Nation-State: Functionalism and International Organization, Stanford:
Stanford University Press, 1964.
19 A. Acharya and A.I. Johnston, eds., Crafting Cooperation: Regional International Institutions in a
Comparative Perspective, Cambridge: Cambridge University Press, 2007.
20 T. Risse, Neofunctionalism, European Identity, and the Puzzles of European Integration, in T.A.
Boerzel, The Disparity of European Integration: Revisiting Neofunctionalism in Honour of Ernst B.
Haas, Oxon: Routledge, 2006, pp. 75-93.
21 It is notable that Haas in the foreword of his last publication describes his neofunctionalist approach as
the forerunner of, and now a part of, constructivism. He goes so far as to suggest his own pragmaticconstructivist approach. E.B. Haas, The Uniting of Europe: Political, Social and Economic Forces,
1950-57, Notre Dame: Notre Dame University Press, 2004, pp. xxv-lii.
22 P.G. Harris, ed., International Environmental Cooperation: Politics and Diplomacy in Pacific Asia,
Boulder: University Press of Colorado, 2002; S.S. Kim, ed., The International Relations of Northeast

84

Asia, Boulder, New York, Oxford: Rowman & Littlefield, 2004.
http://www.mofa.go.jp/region/asia-paci/china/index.html, and http://www.fmprc.gov.cn/eng/wjb/zzjg/
yzs/gjlb/2721/ (accessed September 24, 2009).
24
Speech of Prime Minister Ryutaro Hashimoto – Seeking a New Foreign Policy toward China, http://
www.mofa.go.jp/regionasia-paci/china/seeking.html (accessed January 13, 2009).
25 Ministry of Defense of Japan Defense of Japan 2008, http://www.mod.go.jp/e/publ/w_paper/index.html(accessed May 20, 2009).
26 C.W. Hughes, Japan’s Re-emergence as a Normal Military Power, London and New York: Routledge,
2006; P. Midford, China Views the Revised US-Japan Defense Guidelines: Popping the Cork? International Relations of the Asia Pacific, Vol. 4, No. 1 (2004), pp. 113-145.
27 Personal interviews; National Institute for Defense Studies, Tokyo, March 9, 2009; China Institute ofContemporary International Relations, Beijing, April 14, 2009.
28 M. Masuda, Tokyo and Beijing in Search of ‘Strategic Relations’: A Roadmap for Japan-China
Military Diplomacy, forthcoming in Reconceptualizing the Divide: Identity, Memory, and Interests in
Sino-Japanese Relations, Cambridge: Cambridge Scholars Publishing.
29 M.J. Valencia, The East China Sea Dispute: Context, Claims, Issues, and Possible Solutions, Asian
Perspective, Vol. 31, No. 1 (2007), pp. 127-167.
30 Council for Security Cooperation in the Asia-Pacific (CSCAP), Memorandum No. 13: Guidelines for
Maritime Cooperation in Enclosed and Semi-enclosed Seas and Similar Areas of the Asia Pacific,
http://www.cscap.org (accessed May 20, 2009). See R. Samuels, New Fighting Power: Japan’s Growing Maritime Capabilities and East Asian Security, International Security, Vol. 32, No. 3 (2008), pp.
84-112.
31 This point is supported by views conveyed during personal interviews; National Institute for Defense
Studies, Tokyo, March 9, 2009; China Institute of Contemporary International Relations, Beijing, April
14, 2009; Peking University, School of International Studies Beijing, April 20, 2009, and China Foreign
Affairs University, Beijing, December 5, 2009.
32 R. Drifte, Japan’s Security Relations with China Since 1989: From Balancing to Bandwagoning?
London and New York: Routledge Curzon, 2003.
33 Personal interviews; National Institute for Defense Studies, Tokyo, March 9, 2009; China Institute ofContemporary International Relations, Beijing, April 14, 2009; Ministry of Foreign Affairs, Beijing,
April 15, 2009; China Institute of International Studies, Beijing, April 29, 2009.
34
Speech of Prime Minister Ryutaro Hashimoto – Seeking an New Foreign Policy Toward China,
http://www.mofa.go.jp/regionasia-paci/china/seeking.html (accessed January 13, 2009).
35 S. Nam, Ecological Interdependence and Environmental Governance in Northeast Asia: Politics Versus
Cooperation, in P.G. Harris, ed., International Environmental Cooperation: Politics and Diplomacy inPacific Asia, Boulder: University Press of Colorado, 2002, pp. 168-192.
36 See the Ministry of Foreign Affairs of Japan’s statements on the revision of the ODA policy, http://
www.mofa.go.jp/policy/oda/reform/index.html; and http://www.mofa.go.jp/policy/oda/region/e_asia/
china-1.html (accessed May 10, 2009).
37
Japan-China Joint Press Statement, August 10, 2006, http://www.mofa.go.jp/region/asia-paci/china/
joint0610.html (accessed December 26, 2008).
38 http://www.mofa.go.jp/region/asia-paci/china/joint0704.html (accessed July 8, 2009).
39
Joint Press Statement on the Strengthening of Exchange and Cooperation between the Government ofJapan and the Government of the People’s Republic of China, May 7, 2008, http://www.mofa.go.jp/
region/asia-paci/china/pv0805/press.html (accessed December 26, 2008).
40
The Action Strategy on Trilateral Cooperation among the People’s Republic of China, Japan, and theRepublic of Korea, adopted on November 27, 2004, http://www.fmprc.gov.cn/eng/wjb/zzjg/yzs/dqzzywt/t175827.htm (accessed May 25, 2009).
41 Website of the Tripartite Environment Ministers Meeting (TEMM), http://www.temm.org (accessed
May 15, 2009).
42
Final Report, Tripartite Research on Environmental Management in Northeast Asia, January 2009, p.
36, http://enviroscope.iges.or.jp/modules/envirolib/view.php?docid=2253 (accessed May 17, 2009).
43 Ibid., p. 34.
44 Ibid., p. 28.
45 Website of the Tripartite Environment Ministers Meeting (TEMM).
23

85

Final Report, Tripartite Research on Environmental Management in Northeast Asia, January 2009,
pp. 117-118.
47 Ibid., p. 102.
48 Nam, op. cit.
49 The only project of significant scale is the one addressing dust and sandstorms (DSS). This initiative,
however, was begun and funded by international organizations such as UNEP, UNESCAP, the AsianDevelopment Bank, and the Global Environmental Facility. TEMM has substantially engaged in it only
since 2006.
50 TEMM Joint Communiqué 2006; and Final Report, Tripartite Research on Environmental Management in Northeast Asia, p. 28.
51 United Nations Environmental Programme (UNEP), NOWPAP website, http://www.nowpap.org/
about_02.php (accessed February 3, 2009).
52 NOWPAP Action Plan, http://enviroscope.iges.or.jp/modules/envirolib/view.php?docid=2253 (accessed
May 25, 2009).
53 United Nations Environmental Programme (UNEP), NOWPAP website, (accessed February 16, 2009).
54 NOWPAP, Report of the 13th NOWPAP IGM, November 26, 2008, p. 27, http://www.nowpap.org/(accessed May 25, 2009).
55 Personal interview, Ministry of Environmental Protection, Beijing, April 29, 2009.
56 NOWPAP, Report of the 13th NOWPAP IGM, November 26, 2008, p. 20, http://www.nowpap.org/(accessed May 25, 2009).
57 Together with the People’s Liberation Army Navy and the Ministry of Public Security’s Border Control
Department, and without the Ministry of Environmental Protection, these agencies that dispose of instruments for law enforcement at sea are referred to as five dragons flying over the Chinese seas.
58
Final Report, Tripartite Research on Environmental Management in Northeast Asia, January 2009, p.
101.
59 M. Tamamoto, How Japan Imagines China and Sees Itself, World Policy Journal, Vol. 22, No. 4(2005), p. 60.
46

86

Asian Integration’s Low Visibility in the United States Elite Press:
A Vicious Cycle of Rational Ignorance? 1

Troy Keith Knudson

Abstract
Two recent concerns regarding United States foreign policy toward Asia are the lack of coordination between different types of policy and the lack of policy designed with an understanding of the region as one integrated entity. These concerns are indicative of a lack of perceived
relevance of Asian integration to the United States. An examination of New York Times coverageof Asia shows that (1) Asian integration is not visible in the reporting of correspondents stationed
at news bureaus in Asia; and (2) when Asian integration is covered, it is not portrayed as particularly relevant to the United States. It is argued here that more external recognition of Asian
integration (by global news media outlets, etc.) would facilitate the region’s goal of fostering an
identity toward an Asian community by further legitimating regional integration to Asian citizens.

1. Introduction
The Asian Financial Crisis in 1997 propelled Asian countries into establishing formal institutions such as ASEAN Plus Three (ASEAN+3) and the East Asia Summit (EAS) in order tobetter coordinate the deepening integration within the region and to channel existing rivalries
among countries toward more constructive and cooperative ends. Although recognized as a longterm endeavor, one objective of these institutions is to facilitate the eventual growth of an Asian
community.2 The United States has been notoriously ambivalent about the efficacy of such institutions,3 an attitude that has been explained and/or justified by its indifference toward their statedgoals, which are often defined loosely in terms of the very process of integration.4 Moreover, theUnited States has been said to be indifferent toward Asian integration because of its current focus
on the Middle East and its inability to contemplate a regional structure other than the system ofbilateral alliances that have contributed to the region’s peace and prosperity since the beginningof the post-war period.5
Nevertheless, the United States, though not an Asian country, remains by some accounts
the region’s most prominent power, and any discussion on how to solve global challenges—
from energy security, environmental degradation, and transnational crime; to trade, investment,
and finance—must include the United States.”6 For this reason, some policy analysts have recommended the United States put more effort into understanding and engaging in the processesof Asian integration that are expanding the capacity of Asian countries to address these global
challenges. They argue that even though institutionalized integration in Asia only currently exists
at the economic level, the region’s focus on integrating regional markets has increased the relevance of Asian institutions such as ASEAN, ASEAN+3, and the EAS, and will lead to a diminished role for the United States and Asia-Pacific institutions such as the ASEAN Regional Forum(ARF) and Asia-Pacific Economic Cooperation (APEC). Thus, although it might be argued that
integration limited to the market is hardly important enough for the United States to note, it has
also been argued that this limited integration is merely the seed of a much larger phenomenon
that will eventually require substantial attention from the United States.7
87One of the main objectives of policy analysts making this argument is to put the UnitedStates on a course toward creating a coherent policy toward the region sooner rather than later.
Although the United States is already present in the region militarily, politically and economically, the two major concerns of American policy analysts with an interest in Asia are the lack of coordination between different types of foreign policy directed toward Asia and the lack of foreign
policy designed with an understanding of the region as one integrated entity.8 These concerns areindicative of a lack of perceived relevance of Asian integration to United States foreign policy
makers. The first concern suggests an inability to identify integration as an essential element of
the peace and prosperity of the Asian region. The second concern suggests that foreign policy
makers are unable to identify the United States as an essential element of Asian integration. This
study argues that these identification deficits of United States foreign policy makers are too fundamental to be explained either by ambivalence or by a lack of resources due to the United Statesfighting two wars in the Middle East. Rather, they stem from a lack of perceived connections between Asian integration and the interests of the United States in Asia.

2. International Perception and Foreign Policy Making
How are the international interests of the United States in Asia formed? Weber once argued,
Not ideas but material and ideal interests directly govern men’s conduct; yet very frequently
the ‘world images’ that have been created by ‘ideas’ have, like switchmen, determined the tracks
along which action has been pushed by the dynamics of interest.”9 For the purposes of this study,
it is necessary to understand what information is utilized to create world images inside the mindsof United States foreign policy makers. Information upon which foreign policy is made comesfrom a variety of official and unofficial sources. The content of all such sources, from compilations written by intelligence analysts at the State Department and collected by Congressional
staffers, to reports written by researchers at the Congressional Research Service, to policy papers
written by scholars at think tanks, is worthy of close descriptive and analytical scrutiny. This
study examines a ubiquitous source of information that foreign policy makers consume daily—international news stories from the elite press.10
Although content from the elite press alone cannot sufficiently represent world images existent in the minds of foreign policy makers, scholars of political communication view this dailysource of information as an atlas of places, personages, situations, and events; and to the extent
that the press discusses the ideas that men have for coping with the day’s ration of problems, it is
an atlas of policy possibilities, alternatives, choices.”11 When utilized as such, the elite press becomes a significant force shaping our cultural and political future.”12 The theoretical position ofscholars making this argument is related to the social construction of reality. In this sense, Lynchargues that each decision involved in the news making process contributes to whatever actions
result from the information the news provides: The jobs of commissioning, editing, producing
and reporting involve choices; choices of which facts to include and which to leave out…These
choices combine, over time, into discernible patterns, which exert a cumulative influence overthe course of subsequent events.”13
The constructing of these patterns, often interpreted as a process of the elite press manifesting its control over which events become news and how they are reported, is known as framing.14
Especially with international news, where alternative narratives against which to contrast thosefound in the news media are less likely to exist,15 this process of selection, emphasis, exclusion, and elaboration is a vital aspect of the elite press’ ability to provide a central organizing
idea for news content that supplies a context and suggests what the issue is.”16 A lack of alternative narratives, in turn, makes the effect of framing that much more potent with international
88

news. Thus, as Movahedi argues that images and perceptions of other nations provide the basic framework within which the conduct of international relations and conflict resolution takes
place, inquiries into how the elite press frames international news become worthy of academic
research.17

3. International News Research
One way to measure news frames of the elite press is to reduce the information provided
within the news to smaller, more basic, individual parts that can be quantified.18 Using thistype of methodology, researchers focusing on the ‘cumulative influence’ that international news
in the elite press have over the course of subsequent events (see Lynch above) typically examined one of three behaviors as dependent variables: how other derivative news media reportinternational news, how the public responds to questions about international affairs, and how foreign policy makers determine the most appropriate course of action in response to international
events. While most research to these ends has focused on what the content of coverage actuallyis, this study, by assessing the content of coverage of Asian integration against the standard of theexistential phenomenon of Asian integration, is also an examination of what the content is not. In
this way, this study serves as what Wimmer and Dominick describe as a reality check.”19
Concretely, the purpose of this study is to show that integration among Asian countries is
not visible in the elite news reporting by foreign correspondents stationed at news bureaus within
Asia. Furthermore, this study attempts to show that when Asian integration is covered, it is not
portrayed as particularly relevant to the United States. If this is indeed the situation in elite news
coverage flowing from Asian bureaus, then the information provided within the news is in facta type of misinformation. Were it not for foreign policy makers’ reliance on international news
from the elite press to help form their world images, such misinformation might seem harmless.
However, as Graber argues, Officials and publics who rely on foreign affairs news may be misled, and faulty policies may ensue.”20 Such faults are argued by Jervis to result from discrepancies
between the ‘psychological milieu’ (the world as the actor sees it) [of foreign policy makers]
and the ‘operational milieu’ (the world in which the policy will be carried out).”21

4. Why This Type of Research Is Necessary Now
Since the United Nations Educational, Scientific, and Cultural Organization’s International
Commission for the Study of Communication Problems published a 1980 report that exposed
the transnational media’s practice of transmitting to developing countries only news that they
have cut, filtered, and distorted, [thereby] imposing their own way of seeing the world upon
the developing countries,”22 ‘reality check’ research (see Wimmer and Dominick above) has
yielded insight on various types of distortion within international news coverage. Most research
has focused on Western media outlets, especially those from the United States, and has sought tohighlight distortions and/or bias within news about certain regions of the world, including Asia.
In this regard, findings typically illustrate a lack of coverage about anything other than natural
disasters and political conflict. While these findings have been useful in delineating some determinants and effects of international news, little attention has been devoted to examining the way
the phenomenon of regional integration is portrayed by another region or country’s news media.
This lack of attention, especially from transnational media, is odd in that regional integration has
been defined as a force that relates to—if not overlaps—globalization.23
One exception is a study by Chaban, Bain, Stats, & Sutthisripok, who investigated media
89

images of the European Union created in, and disseminated through, the news media discoursesof four Asia-Pacific countries.”24 Their study examined press coverage from the complete year of
2004 and found that in each Asia-Pacific country studied, the portrayal of the European Union by
the news media was overshadowed by coverage of individual European Union member countries.
They concluded:
It is possible that the prominence of Member States actually indicates a lack of understanding of the European Union’s complex political reality by international newsmakers, or a tendency on their part to assume that their readers and viewers will only understand Member
State actors and not the Community ones. Yet, this newsroom practice may mean a vicious
cycle for the international media representations of the European Union. The more newsmakers portray only the Member State components, the more the public will come to viewthe European Union only in this fragmented way and the more newsmakers will have to prioritize such images in the future in order to retain their audience’s interest.25
A similar argument could be made about the portrayal of Asian integration by the UnitedStates elite press. Through such a vicious cycle, the press exhibits a rational ignorance26 about
Asian integration that may be exacerbating the ability of foreign policy makers to design policy
toward Asia with an understanding of the region as one integrated entity, and to better coordinate
different types of foreign policy directed toward the region.
What difference would it make if United States foreign policy makers were able to design
policy toward Asia with an understanding of the region as one integrated entity, and better coordinate different types of foreign policy toward the region? The answer lies in the fact that while
the process of becoming more integrated is itself a stated goal of Asian regional institutions such
as ASEAN+3 and the EAS, the more difficult processes of building and fostering the identity ofan Asian community are also cited as longer-term goals.27 Writing in the context of the European
Union, Chaban and Holland argue that such processes can be facilitated or thwarted by how aregion’s international identity is represented externally: A lack of external recognition might
negatively influence internal integration…[by] undermining the very legitimacy of the integration process for European Union citizens. In light of these potential risks, an account of the existing external imagery of the European Union becomes a necessity.”28
Similarly, this study argues that recognition of Asian integration by United States foreign
policy makers would facilitate the Asian region’s goal of building and fostering an identity toward an Asian community by further legitimating the process of regional integration to Asian citizens. However, results from this study’s examination of how the United States elite press frames
Asian integration suggest that such recognition from the United States might require an overcoming of the current rational ignorance being exhibited by the press toward the region’s integration.
Thus, it may be in the best interest of regional institutions such as ASEAN+3 and the EAS toenhance the region’s international profile to supplement internal efforts made toward fostering acommon identity.

5. Research Questions
This study is exploratory and seeks to yield preliminary results that can be used in future,
more formal and systematic analyses. First, in order to acquire a general assessment of the stateof coverage about the Asian region, the following research question is put forth: How has the
newsworthiness of the Asian region changed since the Asian financial crisis? Second, as mostliterature on integration in the Asian region emphasizes the critical moment of the Asian financial
90

crisis in 1997 as an instigator of the deepening integration that exists today,29 it is assumed thatsome characteristics suggesting the existence of integration would be detectable in the elite pressof the United States. Thus, the following research question is put forth: To what extent has theelite press in the United States shown the Asian region to be integrating since the Asian financial crisis? Specifically, it is expected that since the crisis, coverage of the Asian region would
become more illustrative of issues that are relevant to more than one Asian country. Third, having argued that United States foreign policy makers designing policy toward Asia lack an understanding of Asian integration, the following research question is put forth: to what extent has theUnited States been portrayed as relevant to the issues of the Asian region?

6. Design of Analysis
Because the press industry in the United States is made up of thousands of local newspapers
with limited budgets, each focusing primarily on issues most relevant to local populations, the international news that appears in most newspapers across the country comes from just a few news
outlets. The New York Times is considered among the most influential of these outlets due to its
ability to affect the content of the nightly news programs of the major television networks andits wide circulation among those with political power, including foreign policy makers. Thus, although it is impossible to generalize the daily consumption of international news by foreign policy makers, the New York Times alone was selected for this study because a realistic execution of
the analysis required a media sample that was relatively narrow. In order to obtain a more comprehensive survey of United States news coverage of the Asian region and to determine whether
or not regional integration is an aspect of that coverage, future studies might also employ any of
the following news outlets: the Washington Post, the Wall Street Journal, the Los Angeles Times,
the Associated Press, and the Cable News Network. Furthermore, this study only takes into account the verbal content that appears within news articles; the content of photographs and othervisual images that often accompany news articles could also be examined to obtain a more comprehensive survey of news content.
Also to make the analysis more manageable, a comprehensive assessment of every year’s
worth of coverage after the 1997 financial crisis was not conducted. Instead, coverage from thefollowing three years was employed to determine the presence of general trends: 1999, 2003, and2007. Content analyses that utilize United States news outlets to examine the news coverage of agiven topic often avoid years in which general elections are held, as unpredictable aspects of theelection itself can become the most newsworthy topic and distort the trends of otherwise normal
coverage. Thus, because general elections at the national level are always held on even-numberedyears in the United States, this study used only coverage from odd-numbered years.
The year 1999 was chosen because it was the first odd-numbered year after the Asian financial crisis. It represents the time when Asian countries were beginning to collectively consider
the inevitability of their interrelatedness and its effect on their future as a region. The year 2007
was chosen because it is the most recent odd-numbered year to have been completed. Although
it was two years prior to the time of this writing, in this study it represents the current situationof the New York Times’ coverage of the Asian region. The year 2003 was chosen because it is exactly between 1999 and 2007; thus, any observable change in coverage from 1999 to 2007 might
be checked by coverage from 2003. In order to obtain a more comprehensive survey of news
coverage, future studies might incorporate additional years. Specifically, as it may prove useful toknow if general elections had an effect on the portrayal of Asian integration, coverage from evennumbered years could be included with a prior understanding that the amount of coverage fromthese years might range from several times as much as odd-numbered years to nonexistent. Also,91

including coverage from before 1997 would allow a comparison of pre- and post-financial crisis
portrayals of the region. Furthermore, obtaining continuous coverage would enable the conducting of a time series analysis to determine more conclusively the presence of statistical trends
within the data.
Because this study is exploratory, specific issues covered by the newspaper, ongoing or otherwise, are not examined in detail. Entire years are used as units of analysis in order to mitigate
the effects of dramatic increases in coverage due to minor crises. Indeed, although the news media do tend to increase coverage in response to crises, the increase is often temporary. This study
assumes that crises occur every year and are thus difficult for researchers to avoid. However, byplacing the coverage of crises in the context of the coverage of an entire year, it is believed that
their effect on the daily coverage of otherwise normal affairs will be minimized. Due to the exploratory nature of this study, no statistical techniques more sophisticated than a comparison ofmeans are employed. In this regard, the objective here is to acquire a general assessment of thecharacteristics of United States news coverage of the Asian region after the Asian financial crisis
in order construct more sophisticated hypotheses and employ more sophisticated statistical techniques for future studies.

7. Research Methodology
LexisNexis was used to obtain the newspaper data. Within the LexisNexis database, international news articles from the New York Times are categorized by world region. In order to obtain
only the articles about the Asian region, article searches were limited to articles from the Asia
Pacific category. Although it is likely that articles including Asian countries can also be foundfrom other international news categories such as Africa or Latin America, this study assumes
that articles covering any aspect of Asian integration would likely be placed in the Asia Pacificcategory. However, this category also includes articles about countries that are not typically considered in the context of Asian integration, such as Afghanistan, Iraq, Iran, and Pakistan. Thus,
article searches were further limited to include only articles that mentioned at least one EAS
member country.30 The EAS was chosen as an entity representative of Asia because it is the mostcomprehensive Asia-based international entity that does not include any countries outside the
New York Times’ international news category of Asia Pacific.31
Also, all articles from the New York Times are categorized by LexisNexis as being froma certain Desk (for example, Foreign Desk, Business/Finance Desk, Sports Desk, Arts/Culture
Desk, etc.). The article searches were limited to only those that came from the Foreign and Business/Finance Desks. This procedure was taken because this study limits the concept of integration to a process that occurs across borders or between countries. Although Asian integration
also occurs and exists in forms unrelated to politics and economics, this study assumes that its
representation in a United States news media outlet would be most easily portrayed as a functionof international relations.32 Articles are categorized by LexisNexis as being from a certain Desk
regardless of whether they were written by journalists from the New York Times or from a news
wire agency to which the New York Times subscribes. On average, about 80% of the New YorkTimes coverage used in this study was written by a New York Times journalist with the remaining
20% being from a news wire agency.

8. Newsworthiness of Asia
This study assessed the newsworthiness of the Asian region by comparing the number of92

articles that appeared in the newspaper over the three years with the average length of the articles. In newspaper research, the number of articles about a given topic is the most widely usedvariable to measure a newspaper’s attention toward that topic. However, one setback in using
this variable alone is that not all news articles are the same length, and length is often attributed
to an article’s capacity to provide contextual and implicative analysis. Thus, although it is often
neglected, article length is an appropriate complement to the actual number of articles when examining the degree of media attention to a given topic.
The length of each article was provided as a word count by LexisNexis during downloading. Because some investigatory articles can be exceptionally long, creating a large gap between
the longest articles and those just above average length, the raw word counts were codified togive this variable a normal distribution. After the raw word count was recorded for each article,
the word counts were rearranged in ascending order and separated into sixty categories with anequal number of articles belonging to each category. Each category was then assigned a value
ascending by 0.1 from 0.1 to 6.0. Thus, each of the sixty values was assigned to an equal numberof articles. The values and the word count range to which they were assigned are provided in Appendix 1.
The total number of articles retrieved from the years 1999, 2003, and 2007 was 3,535, thus
the mean number of articles for the three years was 1,178. Results suggest that in terms of thenumber of articles, the Asian region became less newsworthy over time, as the number of articles in 1999 and 2003 were above the mean (1,297 and 1,288, respectively) and the number ofarticles for 2007 (950) was below the mean. However, results for article length suggest that the
number of articles alone cannot comprehensively illustrate the region’s newsworthiness over thethree years. The mean article length score for all 3,535 articles was 3.04, suggesting an averageword count of between 616 and 639 words. The years 1999 and 2007 had scores above the mean
(3.23 and 3.16, respectively) while the score for 2003 was below the mean (2.77). These results
suggest that articles from 2003 were on average about one hundred words shorter than articles
from 1999, despite the similarity between the years in number of articles. In sum, judging by the
number of articles and article length, the year in which Asia as a whole was the most newsworthy
was 1999, as it scored above the mean with both variables. Coverage from 2003 scored above
the mean in number of articles but below the mean in article length, while coverage from 2007
exhibited opposite characteristics, scoring above the mean in article length but below the mean in
number of articles.
However, it is not conclusive from these results alone that the Asian region, as defined bymember countries of the EAS, has become more newsworthy over time. A more certain conclusion in this regard might be drawn by examining how extensively countries in the region werecovered over the three selected years. A list of countries mentioned in each article was obtained
from LexisNexis during downloading, which also provided a score representing the extent towhich each country received coverage in each article. The range of score is similar to a scale of
one through forty, with forty representing the highest level of coverage. However, because somescores were used more extensively than others, the raw scores were codified to give this variablea distribution closer to normal. Similar to article length, after the raw score was recorded for eachcountry, the scores were rearranged in ascending order and separated into six parts. Divisions
were made between categories so that they would be as equal as possible. Each part was assigned
a value ascending by one from one to six. A review by the author of a selection of articles confirmed that a score of one was given when a country was hardly mentioned, while a score of six
was given if an article was basically about that country. Scores two through five represent points
along a continuum bridging these two extremes, creating a scale that quantifies how extensively
countries are covered.
In order to determine how often some aspect of the Asian region was given considerable
93depth of coverage, this study examined the percentage of articles that gave any member countryof the EAS a coverage score of six. The percentage of all 3,535 articles that covered any EAS
member country at this level was 21.33. Individually, the years 1999 and 2003 were below thispercentage (20.89% and 19.72%, respectively) while 2007 was above (24.11%). This finding
seems to correlate somewhat with article length, suggesting that adequate space is required forcountries to receive a high level of coverage. This finding also seems to negatively correlate with
the number of articles appearing per year, suggesting that foreign correspondents stationed in the
Asian region are now writing more in depth coverage about the region, albeit with a more limited
number of articles. The findings from the four variables examined here, which suggest that Asian
integration, though covered more extensively in recent years, may not be a phenomenon worthyof much coverage in the United States press, are shown in Table 1.
Table 1: General Characteristics of News Coverage
1999

2003

2007

Total (Mean)

Articles (Count)

1,297

1,288

950

1,178

Length (Mean)

3.23

2.77

3.16

3.04

Level 6 (Percent)

20.89

19.72

24.11

21.33

Countries (Mean)

1.43

1.59

1.56

1.52

9. Portrayal of Asian Integration
While the above findings regarding the newsworthiness of the Asian region are important toassess the general characteristics of coverage, they suggest little about the newspaper’s coverageof integration among the nations of the EAS. Indeed, findings from the number of countries mentioned in each article suggest yet another trend. Keyword searches of the term integration, as wellas the names of regional institutions such as ASEAN, ASEAN+3, the EAS, and APEC, yielded
samples of articles too small for statistical comparison. Thus, this study sought to examine lessexplicit representations of Asian integration; the portrayal of Asian integration was assessed bycomparing the number of Asian countries mentioned in each article over the three selected years.
It is assumed that as integration deepens within the region, issues become relevant to a larger
number of countries in the region. If this phenomenon is considered newsworthy by the newspaper’s reporters, the evidence should be found in the number of countries appearing together in thedaily coverage of the region.
Because this study defines the Asian region as the member countries of the EAS, each timea member country was denoted by LexisNexis as having been mentioned in an article, its presence was recorded. The mean number of countries appearing in all 3,535 articles was 1.52. The
years 2003 and 2007 had scores above the mean (1.59 and 1.56, respectively) while the score for1999 was below the mean (1.43). Thus, similar to articles exhibiting a high level of coverage,
even though the trend in the general newsworthiness of the Asian region seems to have decreased
since the Asian financial crisis, the coverage itself seems to be congruent with the fact that Asian
countries are indeed integrating. However, this finding should be interpreted with caution since,as Table 2 shows, the large majority of articles from each year include coverage of only one
country, suggesting that the United States’ propensity for bilateral relations in the Asian region
may be existent in this characteristic of news coverage.

94

Table 2: Number of EAS Countries Mentioned per Article
1999

2003

2007

952; 73.40%

833; 64.67%

626; 65.89%

2 Countries

235; 18.12%

277; 21.51%

192; 20.21%

3 or More Countries

110; 8.48%

178; 13.82%

132; 13.89%

1 Country

10. Presence of the United States
In order for the United States to design foreign policy based on an understanding of one integrated Asian region, it is assumed that issues relevant to integration in the region must also be
perceived as relevant to the United States. Coverage of the Asian region within elite news media
outlets such as the New York Times should provide some indication, symbolically or informatively, of whether or not an integrating Asia is considered as relevant by American foreign policy
makers. This study examined the percentage of articles that mentioned the United States, as well
as how extensively the United States was covered in each article. The method of collecting thedata for these variables was the same as that explained above regarding the data collection for the
EAS countries.
The percentage of all 3,535 articles that mentioned the United States was 52.39, or 1,852
articles. The years 1999 and 2003 were below this percentage (50.81% and 51.09%, respectively)
while 2007 was above (56.32%). This finding shows that on the surface, issues relevant to the
Asian region seem to have been portrayed as increasingly relevant to the United States after the
Asian financial crisis. The fact that data from this variable and the percentage of articles covering
an EAS member country at the highest level were by far the highest during 2007 suggests thatcoverage of the Asian region is moving in an auspicious direction, with Asian integration portrayed as relevant to the United States. However, this finding suggests little regarding the levelof coverage the United States received in these articles. The mean score for the level of coverage
the United States received in all the 1,852 articles in which it was mentioned was 3.07. The years
1999 and 2007 had scores below the mean (2.97 and 2.91, respectively) while the score for 2003
was above the mean (3.29). Thus, even though the United States was most often mentioned during 2007, the level of coverage it received was the lowest, dampening the validity of any conclusion implying an increase in relevance of Asian issues to the United States over time. The findings from the two variables examined here are shown in Table 3.
Table 3: Mention of the United States within the News Coverage
1999

2003

2007

Total (Mean)

Articles (Count)659; 50.81%

658; 51.09%

535; 56.32%

1,852; 52.39%

Level (Mean)

2.97

3.29

2.91

3.07

11. Newsworthiness of Individual Asian Countries
Having established that coverage of the Asian region has mentioned more countries per article in recent years than just after the Asian financial crisis, suggesting that foreign correspondents
stationed in the Asian region perceive its integration, it would be useful to know if some countries are receiving more coverage than others. Particularly, if it is argued that the perception of
Asian integration in the elite news media is symbolic and constitutive of the perception leading to95

certain policies toward the region, it would be important to know which countries are perceived
as the most important actors in the integration process; it is with these countries that the UnitedStates will most likely be interested in engaging.
To this end, this study examined the articles from Table 1 that covered EAS member countries at the highest level to determine which countries were most often given this type of coverage. Results show that for each of the three selected years, China not only received the largest
amount of high-level coverage articles among EAS countries, but it also received more than allother EAS countries combined. Similar results were found when looking only at articles that covered the United States at the highest level, as shown in Table 4. Clearly, in terms of extensivenessof coverage, China is perceived as the most newsworthy country in the Asian region. Results indicate that the most extensive coverage devoted to the phenomenon of Asian integration, whether
perceived as relevant to the United States or not, is portrayed through a China lens. Indeed, mostof the time, relevance of an issue to China seems to be a prerequisite for highly extensive coverage.
Table 4: Highest Level Coverage of Individual Countries
1999

2003
Level 6

2007

Level 6

w/US – 6

w/US – 6

Level 6

Cambodia

8; 3%

1; 4%

6;

2%

Indonesia

6; 2%

7;

3%

Laos

1

2;

1%

1

Malaysia

8; 3%

2;

1%

1

Myanmar

2; 1%

9;

3%

11;

8;

3%

w/US – 6

Brunei

Philippines
Singapore

1

1
2;

1;

5%

3%

7;

3%

Thailand

2;

1%

1

Vietnam

2;

1%

4;

19; 76%131; 50%

Japan

38; 14%

4; 16%

S. Korea

8; 3%Australia

3; 1%

India

34; 13%

N. Zealand

1

Total

272

1; 4%

1;

4%

1
4; 2%

162; 60%

4%

5%

2; 1%

China

1;

2%

18; 49%128; 55%

13; 57%29; 11%

2;

24; 10%2;

34; 13%12; 32%15;

6%

4; 17%

7;

3%

1;

3%

9;

4%

18;

7%

1;

3%

26; 11%

2;

233

23

5%

9%

9%

1
25

260

37

12. Conclusion
This exploratory study sought to uncover some characteristics of New York Times’ news
coverage of the Asian region from the period just after the Asian financial crisis (1999) until two
years prior to the time of writing (2007). Because all of the data used in the analysis were automatically generated by LexisNexis, the usage of human coders, and subsequently, an inter-coder
reliability test, was unnecessary. The objective of this study was to expose the low visibility of
Asian integration within the coverage, as well as the lack of perceived relevance of Asian integration, to the United States. The argument put forth began with the fact that, despite its prominence96within the region, the United States is notoriously ambivalent toward institutions that represent
and symbolize the deepening of Asian regional integration. It was argued that current accountsof this ambivalence, which focus on the indifference of the United States resulting from its propensity to see the region through the lenses of its alliances and through bilateral relations, neglect
to address the perceived irrelevance of Asian integration to the United States. Literature fromthe field of political communication was used to show that foreign correspondents of the UnitedStates elite news media are partially responsible for rectifying this lack of perceived relevance.
It was shown that even though fewer articles from the region have been published recently
compared to just after the Asian financial crisis, recent articles tend to be longer and, to an extent,
include more EAS countries per article. However, overshadowing this finding is the fact thatmost articles still only mention one country, which precludes any discussion of regional integration as a function of international relations. As for the perceived relevance of regional integration
to the United States, results are similar. Recent coverage shows a higher percentage of articles
that mention the United States; however, this increase in appearance is coupled with a decreasein the extent to which the United States is covered, which precludes any discussion of why issues related to Asian integration are relevant to the United States. Thus, this study concludes that
Asian regional integration does indeed have a low visibility and is not portrayed as relevant to
the United States, at least in the New York Times. Although it was beyond the scope of this study,
future studies might compare the valence of the articles used here to determine if the increasing
trend in characterizing the countries of the region as integrating is portrayed by more positive or
negative coverage.
Even though the content of New York Times news articles may never directly reach thehands of Asian policy makers, policy analysts, or citizens, the international content influences theway American foreign policy makers perceive the world outside the United States. Over time,the impact of coverage of Asia can be found in the nuances of American foreign policy toward
Asia. It has been argued here that United States’ recognition of Asian integration would facilitate
the region’s goal of building and fostering an identity vis-à-vis an Asian community, as it could
further legitimate the process of regional integration to Asian citizens. There has been much debate about whether the United States should be a participant of Asian integration. To the extent
that this study has argued for United States participation, it has done so with the belief that theparticipation of a major non-Asian world player would enhance the attractiveness of Asian integration internally. For this reason, it may be in the best interest of Asian regional institutions
such as ASEAN+3 and the EAS to enhance the region’s international profile in addition to theefforts made internally toward constructing a common identity. How can this be done? Becauseof the layered nature of Asian integration (from the existence of many overlapping institutions),
the process of defining and enhancing a coherent international profile will likely require an unprecedented amount of cooperation between different regional institutions. It may prove usefulto create a committee under the joint auspices of ASEAN, ASEAN+3, and the EAS whose main
objective is to promote the understanding of Asian solidarity to other parts of the world.
The political communication research used in this study suggests that one method by whichsuch an objective should be pursued is the winning over of major international news media outlets. In addition to the methodological limitations listed above regarding the sample of articles
used in this analysis, the current study is further limited in that detailed explanations are not given for why the New York Times and/or other news outlets neglect the integrative aspect of Asia.
Hamilton’s argument on rational ignorance within the news media was incorporated to suggestthat foreign correspondents ignore this aspect of the region because, in their view, the cost of understanding Asian integration and explaining its relevance to the United States would outweighany potential benefit. Future studies might employ interviews with foreign correspondents andeditors of American news outlets in Asia to determine if this is indeed the case. If such an argu97

ment is valid, then it is essential that efforts to enhance the international profile of Asia include
explaining the relevance of Asian integration itself to desired targets, as the rational ignorance
within the current media situation can only be overcome by competitive, alternative interpretations of reality.

Notes
The research in this paper was made possible by a fellowship and research grant provided by the Japan
Society for the Promotion of Science. The author alone is responsible for its contents.
2 Sung-Joo Han, Tommy Koh, and C. Raja Mohan, Asia’s Views of America’s Role in Asia 2008: An
Overview, in The Asia Foundation, America’s Role in Asia: Asian and American Views, San Francisco:
The Asia Foundation, 2008, p. 3.
3 Han, Koh, and Mohan argue, The remarkable differences among Asian countries in history, culture, religious traditions, and levels of economic development contribute to American skepticism that creating
an East Asian Community is not possible (ibid.).
4 Ellen L. Frost, America’s Role in Engaging with Asia’s New Regionalism, in The Asia Foundation,
America’s Role in Asia: Asian and American Views, San Francisco: The Asia Foundation, 2008, p. 117.
5 Campbell, Patel, and Singh argue, The nations of Asia are integrating, innovating, and investing inways remarkably different from what American statesmen and international relations theorists havegrown to expect and understand, in Kurt M. Campbell, Nirav Patel, and Vikram J. Singh, The Powerof Balance: America in Asia, Washington, D.C.: Center for a New American Security, 2008, p. 5.
6 Frost, America’s Role in Engaging with Asia’s New Regionalism, p. 115. Han, Koh, and Mohanargue, From Japan to Afghanistan, the United States plays a crucial role in the security, political, andeconomic affairs of the region. The United States is either the first or second largest trading partner ofalmost every Asian nation in all three sub-regions [Northeast, Southeast, and South Asia] (Han, Koh,and Mohan, p. 2).
7 Bergsten argues, It is clear that the time has come for the United States to take seriously the likely
construction of new Asian economic arrangements since these arrangements could well have importantconsequences for the United States itself and for global economic (and possibly political) patterns andinstitutions, in C. Fred Bergsten, China and Economic Integration in East Asia: Implications for theUnited States, Policy Briefs in International Economics, No. PB07-3, Peter G. Peterson Institute for International Economics, 2007, p. 9.
8 Regarding the former concern, Frost argues, For at least the last ten years, United States policies toward Asia have been compartmentalized by issue and by country, with little attention paid to Asia’s new
regionalism and even less interagency coordination. Region-wide economic and security policies are
rarely discussed in the same room (Frost, pp. 122-123). Campbell, Patel, and Singh argue, the sumof America’s tactical successes does not add up to a successful and comprehensive strategy, in Kurt
M. Campbell, Nirav Patel, and Vikram J. Singh, The Power of Balance: America in Asia, Washington:
Center for a New American Security, 2008, p. 5. Regarding the latter concern, Campbell, Patel, andSingh argue, Failure to more fully interact in Asian institutions may undermine many gains America
has made in the past 50 years. Asia is integrating at an unprecedented rate; America should respond byinvesting greater diplomatic capital and aligning focus toward the region (ibid., p. 80).
9 H. H. Gerth and C. Wright Mills, From Max Weber, New York: Oxford University, 1946, p. 280.
10 O’Heffernan argues, On a daily basis, the various levels of foreign policy makers in the United States
government read, watch, and listen to the media for news of what is going on around the world before
the cables and reports come in. What they see and hear and read is often a broader and more diverseworldview than what they receive officially, in Patrick O’Heffernan, Mass Media and American Foreign Policy, Norwood, NJ: Ablex, 1991, p. xi.
11 Bernard Cohen, The Press and Foreign Policy, Princeton: Princeton University, 1963, p. 13.
12 O’Heffernan, p. xi.
13 Jake Lynch, Reporting the World: The Ethical Challenge to International News, in Chris Paterson andAnnabelle Sreberny, eds., International News in the 21st Century, London: John Libbey, 2004, pp. 262263.
14 Natalia Chaban, Jessica Bain, Katrina Stats, and Paveena Sutthisripok, Mirror Reflections? The EU in
1

98

Print and Broadcast Media in the Asia-Pacific, in Martin Holland and Natalia Chaban, eds., The European Union and the Asia-Pacifc: Media, Public, and Elite Perceptions of the EU, New York: Routledge,
2008, p. 22.
15 Ibid.
16 James Tankard, Laura Hendrickson, Jackie Silberman, Kriss Bliss, and Salma Ghanem, Media Frames:
Approaches to Conceptualization and Measurement, paper presented at the Annual Meeting of the Association for Education in Journalism and Mass Communication, Boston, 1991, p. 3.
17 Siamak Movahedi, The Social Psychology of Foreign Policy and the Politics of International Images,
Human Affairs, Vol. 8, October 1985, p. 19. On this same note, Jervis argues that it is often impossible to explain crucial decisions and policies without reference to the decision makers’ beliefs about
the world and their images of others, in Robert Jervis, Perception and Misperception in International
Politics, Princeton: Princeton University, 1976, p. 28.
18 W. Paul Vogt, Dictionary of Statistics and Methodology: A Nontechnical Guide for the Social Sciences,
Thousand Oaks, CA: Sage, 1999, p. 238.
19 Roger D. Wimmer and Joseph R. Dominick, Mass Media Research: An Introduction, Belmont, CA:
Wadsworth, 2003, pp. 142-143.
20 Doris A. Graber, Mass Media and American Politics, Washington, D.C.: Congressional Quarterly, 1989,
p. 345.
21 Robert Jervis, Perception and Misperception in International Politics, Princeton: Princeton University,
1976, p. 13.
22 Mustapha Masmoudi, The New World Information Order, The Journal of Communication, Vol. 29,
No. 2 (1979), p. 174.
23 Arie M. Kacowicz, Regionalization, Globalization, and Nationalism: Convergent, Divergent, or Overlapping? Working Paper, No. 262, Kellogg Institute, Notre Dame University, 1998, pp. 12-14.
24 Chaban, Bain, Stats, and Sutthisripok, p. 23.
25 Ibid., p. 56.
26 Hamilton explains that one factor leading to the lack of public affairs coverage in the news media isthe low demand for it from news consumers: The low demand for public affairs information translates
into fewer incentives for outlets to offer the coverage and sparse rewards for journalists interested inproviding this type of news. Rational ignorance among consumers generates rational omissions among
reporters. The result may be less than optimal amounts and types of public affairs coverage, in James
T. Hamilton, All the News That’s Fit to Sell: How the Market Transforms Information into News, Princeton: Princeton University, 2004, p. 12. The same argument can be made for news about Asian integration, which does not seem to be in high demand among news consuming foreign policy makers (or the
public).
27 In a 2001 report, the East Asia Vision Group listed the following as its first guiding principle: Shared
Identity – Together we shall develop a shared regional identity by working to galvanize the aspirationsof our peoples, promote greater trust and confidence, and advance common interests so as to foster a
new sense of regional community (East Asia Vision Group, Towards an East Asian Community: Region of Peace, Prosperity, and Progress, East Asia Vision Group, 2001, p. 8).
28 Natalia Chaban and Martin Holland, Introduction: Research Rationale, Theoretical Underpinnings, andMethodological Considerations, in Holland and Chaban, eds., p. 4.
29 According to the East Asia Vision Group, The Asian financial crisis of the recent past has provided astrong impetus to strengthen regional cooperation. This has given rise to the recognition that East Asia
needs to institutionalize its cooperation to solve similar problems and prevent new ones (East Asia Vision Group, p. 7).
30 The EAS member countries are: Australia, Brunei, Cambodia, China, India, Indonesia, Japan, Laos,
Malaysia, Myanmar, New Zealand, the Philippines, Singapore, South Korea, Thailand, and Vietnam.
31 For example, ARF and APEC include a much more comprehensive set of countries that could be defined as Asian, but they also include countries from the European Union and Latin America, which
would make the sampling of articles much more difficult.
32 Thus, for example, even though Korean soccer players who play for clubs in the Japanese professional
league, and a tour of a Chinese ballet company throughout Asian cities can both be considered formsof Asian integration in the cultural sense, articles about these issues would not be represented by thisstudy’s findings unless they came from either the Foreign or Business/Finance Desks.

99

Appendix 1: Word Count Value Assignment
Value

Words

Value

Words

Value

Words

Value

Words

Value

Words

Value

Words

0.1

28~

1.1

179~

2.1

462~

3.1

639~

4.1

860~

5.1

1111~

0.2

71~

1.2

209~

2.2

479~

3.2

662~

4.2

889~

5.2

1140~

0.3

81~

1.3

246~

2.3

499~

3.3

687~

4.3

904~

5.3

1167~

0.4

88~

1.4

279~

2.4

519~

3.4

715~

4.4

931~

5.4

1211~

0.5

95~

1.5

310~

2.5

540~

3.5

739~

4.5

953~

5.5

1251~

0.6

100~

1.6

335~

2.6

559~

3.6

759~

4.6

975~

5.6

1314~

0.7

109~

1.7

359~

2.7

570~

3.7

776~

4.7

1003~

5.7

1387~

0.8

119~

1.8

379~

2.8

580~

3.8

796~

4.8

1028~

5.8

1480~

0.9

132~

1.9

406~

2.9

597~

3.9

816~

4.9

1051~

5.9

1653~

1.0

155~

2.0

436~

3.0

616~

4.0

839~

5.0

1080~

6.0

1903~

100

Reviving Japanese Traditional Industries: Prospects and Strategies for
1
Asian Regional Integration

Jennifer Beamer

Abstract
In the 1980s, most Asian traditional craft industries severely declined, deeply impacted by
the process of globalization. Japan’s craft industry was no exception, and in looking for new
ways to expand the shrinking domestic market for crafts, Japan’s Ministry of Economy Trade andIndustry (METI) began to look for opportunities outside its borders. Several prospects emergedin the form of cooperative and developmental craft exchanges designed to raise awareness andcreate an appreciation for traditional commodities among Asian neighbors.
While research to date concerning Asian regional integration has focused mainly on economic analysis, this paper argues that focusing on the social and cultural benefits of such craft
cooperatives is potentially a more effective means for successful regional integration and advancement of Asian community building. Furthermore, as traditional crafts are material objects
that can represent aspects of local, ethnic or cultural identity, therefore symbolizing not only the
economic, but also social and cultural elements of a society, they can be part of the discourse of
grassroots integration focused away from the elite.
This paper investigates the case of a regional community initiative—Japan’s Kiso Lacquerware Technical Cooperation Project and educational exchange with the Union of Myanmar in
1998. As an initial investigation, this paper will suggest preliminary strategies for regional cooperation and the survival of traditional industries.

1. Introduction
In the 1980s, most Asian traditional craft industries severely declined, deeply impacted by
the process of globalization.2 For most developed nations, the causes of the decline were the rapid
economic growth in the post-World War II era, the introduction of new technologies, and the fullfledged mass production of products made of new synthetic materials. Japanese traditional goods
were no exception. Though still produced today, these goods have been delegated as traditional
crafts, and their domestic production and distribution is in a state of crisis. This is confirmed in astatement made by Urushihara in 2004, a member of the Association for the Promotion of Traditional Crafts Industries and researcher at the School of Policy Studies, Hosei University, Tokyo:
One major factor behind the slump [in] the demand for traditional crafts in Japanis the preference towards homogenization that has affected culture and lifestyle as aresult of expanded globalization. [Examples of the decline in demand are] the mass
production and marketing of standardized industrial products at low prices, the role oftraditional crafts in daily life continues to decline, with demand domestically for traditional crafts dithering, new avenues of distribution and consumption must be found[sic].”3
Thus the producers of Japanese traditional crafts are desperately seeking new markets and101consumers for their craft-goods, not only domestically, but especially among their neighbors in
Asia. While some scholars may suggest that such economic trade and investment opportunities
are the basis for regional integration,4 this paper argues that Asian regional integration may only
be achieved after the development of a regional identity and, therefore, opportunities for the development of a common identity must be explored. Traditional craft cooperatives can provide
such opportunities, not only as the production of commodities but with the prospect of a strategy
to enhance the process of Asian regional integration—to build more than just an economic community. The production of traditional crafts and the cooperation of crafts persons could form afoundation for mutual understanding of values and culture to thereby increase Japan’s opportunities for regional integration activities. Comparable craft traditions exist for lacquerware, ceramics, and textiles in Asian countries and regions such as China, Taiwan, South Korea, Thailand,
Myanmar, Vietnam, and Bhutan. Historically, some of these craft production processes have been
imported and exported to Japan from these countries. Japan possesses a rich and diverse craft
industry that, in sharing with the region, could be a bridge of common values in an effort to build
more than just an economic region.
Furthermore, it is proposed that these types of community-building craft cooperation initiatives could be regarded as a central part of integration within the Asian region, as they will contribute to the enhancement of social and economic development of the member countries usingcrafts as an agent of development and social cohesion. It may be obvious that people-to-people
contact is an important bond and basis for cooperation between states, and thus, diversified cultural exchanges together with Japan’s neighboring countries should be undertaken.
In order to more fully explore this issue, this paper will examine cultural-theoretical approaches to globalization and regionalism thus far, where it is argued that much of the scholarly
literature focuses on processes of regionalism as related to economics.5 Then craft is described as
something linked to identity and value to be used as a starting point or tool for integration. Finally, the paper presents a review of the current situation of traditional craft in Japan and provides
strategies for integration based on the preliminary investigation of the case of the Japanese Kiso
Lacquerware Cooperative with Myanmar.

2. Theoretical Approach: Where Is the Social in Asian Regional Integration?
The volume of literature on Asian regional integration to date emphasizes the economic features in regionalism. Higgots, for instance, defines regionalization as processes of integrationthat arise from markets, private trade and investments flows and from the policies and decisionsof companies rather than the predetermined plans of national or local governments,”6 while Breslin observes that regionalization involves processes by which societies and economies become
integrated—particularly but not only in the economic sphere.”7 However, to sociologists interested in the construction of identity for societies and regions, which have the potential to embrace acommon set of values, a genuine lack of discourse on the non-economic aspects such as identity
in regional integration is evident. Few scholars have addressed how regions with economic andpolitical arrangements8 have enhanced their social cohesion and/or determined issues of relations
concerning distinct cultural groups.9
In sociology, cultural approaches to economic growth and regional development are notnew, especially in comparative research. Max Weber drew conclusions regarding the relative
strengths of religious cultures for economic expansion. However, in the wake of the Cold War
and the rapid rate of change in the age of globalization, cultural discourse has become particularly popular and controversial. Within sociology, there are two broad arguments.
First, with the weakening of global and political-ideological conflicts, economic and politi102

cal regionalism has become more common. Of course this has not been immediate, but has beena process of gradual development over a number of decades.10 Parallel to this ideological debate,a cultural debate has arisen and been attached to various political and economic indicators. It has
also been argued to bolster economic and political friction. For example, Huntington states:
The fundamental source of conflict in this new world will not be primarily ideological or primarily economic. The great divisions among humankind and the dominating source of conflict will be cultural…[The] principal conflicts of global politics will
occur between nations and groups of different civilizations. The clash of civilizations
will dominate global politics.11
Therefore, socially or culturally based arguments often underscore the homogenizing consequences of the forces of globalization. In some cases, they highlight the unpleasant effects of thisprocess. That is, regions and the people in them become more aware of their differences as cultures interact with each other. They hypothesize that this has been heightened by a resurgence oftraditional identity and values resulting from the uncertainties of socio-political change in somesocieties.
The second, more popular argument holds that culture and regional values are declining asa result of domestic and international politics in the context of the pressures of globalization.12
The process is discouraging traditional values and institutions, while producing a convergenceof cultures through communication, travel, and trade: a fledgling homogenizing world culture
as a consequence of increasing shared experiences or, as explained by Havel, creating an amalgamation of cultures in a transcendent global ethos.”13 Also, Fukuyama argues that the spreadof free-market economics and democratic politics is a process which guarantees an increasing
homogenization of all human societies, regardless of their historical origins or cultural inheritances.”14

3. What Function Could Social and Cultural Values Serve For the Prospect of Integration?
This question is under-explored and answers to it are ambiguous at best. What is unclear isthe prospect of creating a common social or cultural community, and what is necessary to define
or even understand what those values or commonalities might be. The concept of common identity for regional integration relies upon a number of assumptions, which have serious methodological and practical problems.
First, the construct of a regional or national identity is founded on the idea that the components that characterize a nation tie sub-cultures together within a national boundary. Keillor andHult suggest that national identity has four components: cultural identity or a set of meanings that
set it apart from other cultures; a belief structure facilitating cultural participation and solidarity;
national heritage defined as a sense of the culture's unique history; and ethnocentrism, the way
in which individuals or societies make judgments and attributions using their own cultural perspectives as baseline criteria.15 National identity is therefore an abstraction, an imagined communion,16 whereby individuals are united not by a geographical space but by a collective identity.17
In fact, Despres argues that this identity can be self-ascribed and need not correspond to identities that others impose, with the most important criterion being that individuals want to belong toa group.18 Therefore, national culture, or the signs and symbols of such identity, is a way of constructing meanings that influence people's actions and conceptions of self.19
The challenge in constructing or imagining a common Asian identity is that doing so meansthat social, economic, and political characteristics of Asian countries are based upon shared val103ues which are identifiable and distinct, and which transcend national, religious, and ideologicaldifferences. The arguments presented thus far in the literature posit Asia as a value system in thecontext of an East-West dichotomy. Those arguments maintain that cultural values have underpinned the growth rates of Asian countries and conditioned the orderly social and political characteristics of the region.20 The role of common values, identity, and regionalism, however, is amatter of debate. Scholars such as Leifer who have adopted a perspective based on international
relations have minimized the importance of values, seeing them as being convenient instrumentsof states.”21 In spite of this view, the importance of social, cultural or common values cannot beeasily discounted with respect to the idea of Asian regional integration. Early functionalists like
Karl Deutsch22 identified the formation of common identity as the driving force of regional institutional integration.
The second challenge is that regional integration appears to occur at the official and elitelevels, where value struggles seem to be most often presented as economic aspects of regionalism. This approach effectively dismisses the concept of a grassroots-level regionalism, or regionalism among the people. The tendency is to emphasize the role that economics plays in regionalism.
It may be naive to overstate the importance of identity and values in the process of regionalism and regionalization. It is understood that regional organizations, especially in Asia, are forged
due to the national interests of its regional members who heed their economic and geopoliticalinterests for the region over any sense of shared belonging. These interests are often economic innature, and this favor explains why the economic aspects of regionalization and regionalism areoften stressed. Nonetheless, citizens of individual member states who distrust or hold negative
attitudes towards one another will make it difficult for regional organizations to work effectively
on nontraditional security issues that carry a human dimension—for example, the case of illegal
migration or transnational crime. Acharya, writing in the context of Southeast Asia, observes:
The success or failure of Southeast Asian regionalism is explained not just by the great
power balance, but also by ideational forces; including norms and the politics of identity building. Norms and identity matter; while they are not the only determinants ofregionalism in Southeast Asia, they are a central determinant…while norms do matter,and they do not necessarily matter in a positive, progressive manner. They can matter
negatively, by creating barriers or obstacles to change.23
Examining regional integration requires a comprehensive, balanced analysis of its formal
and informal characteristics. At the institutional (formal) level, integration addresses official
aspects like economy and security, while at the informal level, it refers, as Rumley suggests, toa sense of belonging or feelings of community in a social or cultural sense—that is, it is a construct associated with identity.”24 Additionally, it is also important to shift efforts from discussing
integration at the elite level to that of non-state actors. As Thomas observes, If a regional community is to be forged, then it has to go beyond the policy elites to include the peoples, societies,
and nations [of the region].”25 Even if a regional sense of values is vague in Asia, such sense isnecessary to further common interests and initiatives.

4. Japanese Traditional Crafts: Common Ground for Integration
Traditional crafts may be considered unique in comparison to other commodities that are
frequently used in the construction of a society’s local, national, or global identity. In the following analysis, it is necessary to subscribe to the beliefs of anthropologists who take objects seri104

ously, like Douglas, who regards material objects as carriers of meaning,”26 and Miller, whoemphasizes that objects are constructed as social forms.27 Crafts are defined as products that are
created either completely by hand or with the help of tools. Crafts are made from raw materials
and can be produced in unlimited numbers. Such products can be utilitarian, aesthetic, artistic,
creative, culturally expressive, decorative, functional, traditional, religiously and socially symbolic and significant.28
According to Schlereth, objects such as crafts can reflect the beliefs, values, ideas, attitudes,
and assumptions of a particular community or society at a given time.29 The common assumption
underlying craft objects made or modified by humans is that those objects can reflect the belief
patterns of individuals, and of the larger society to which they belong. It could then be said thatmaterial objects produced and consumed by large collective groups of humans, or nations, could
offer insight into how those individuals and groups sustain life and society, how they reproduce
or transform their social relations, and how they can mediate differences in interests and values.30
Japanese crafts are said to be a reflection of Japan’s traditional past and are promoted
as symbols of local identity, serving to thwart the threat of culture and identity-loss engenderedby globalization. At the same time, these crafts are asserted to be somehow different from similar traditions found in other Asian countries. Craft has a long history in Japan, and is a modern
marker of identity because it contrasts with traditions of western countries. It is also presented
as distinctive from production in other Asian areas; but at the same time, Japanese craft is also
viewed as a unique hybrid of identity influenced greatly by its surrounding Asian neighbors. One
could assert that many crafts thought to be indigenous representations are in fact not unique toJapan, as some traditional craft processes were imported or created by Asian immigrants andcrafstpersons.31 Crafts elsewhere have similarly been used as symbols of national identity. For
example, in both the United States and Canada, quilting becomes a symbol where craft and concepts of national heritage merge. The fact that quilting can be embraced by both societies as acultural symbol representing a particular historic tradition shows that a craft need not be uniqueto a given society to be embraced as a symbol of cultural identity.
There are parallels surrounding economic segregation in modern societies, and the paradoxical nature of consumerism surrounding craft. As acknowledged by Creighton, the desire to
re-capture crafts, or to engage in them as craftspeople, often involves an ideological rejection ofcommercialism and consumerism.32 However, despite such desires, these processes are infusedthroughout the place of craft in modern societies, seen in examples such as craft tours, the marketing of craft classes, the selling of craft products, and the survival of craft techniques in themarket.
The economics in which craft is embedded still evoke considerations of identity and values.
For William Morris (1834–1896), a leader in Britain’s nineteenth century craft re-vitalization
movement, the commitment to craft ultimately fostered a commitment to socialist thought. He
believed that alleviating economic differentiation was necessary to reach the ideal of paradise on
earth, and to allow all people to appreciate the beauty that can potentially exist in everyday life
through the close interface with crafted material goods.33 However, making a living out of craft in
the present economic climate usually means catering to an affluent elite.34

5. The Present Condition of Japanese Crafts and the Need for Integration
Japanese formal authorities have been vigorously involved in protecting and reproducing
traditional cultural properties. Commencing in the 1950s, the Japanese government began protecting intangible cultural properties and traditional craft techniques, and designated the people
who make them as human or national treasures.35 Traditional production locations are also105

protected by Japanese authorities, as in the case of the Japanese Folklore Society designating
places with titles such as the most traditional village left in Japan.”36 Nevertheless, the annual
production value of traditional crafts, according to the Ministry of Economy, Trade, and Industry(METI), maintained a monetary value of 500 billion yen throughout the 1980s, although a gradual decreasing trend occurred. However, in the 1990s, the rate of decrease suddenly accelerated,
and in 10 years, that figure was slashed in half, dropping to about 260 billion yen in 2000 (seeTable 1 for a more detailed breakdown of the decline).
Table 1. The Present Condition of Japan’s Traditional Craftwork Industry
Item

2006

Reference Value(Peak Year)The number of people engaged in
the craft

93,000 people

290,000 people (1979)

The number of companies

16,700 companies

34,043 companies (1979)

The amount of production

177.3 billion yen

540.0 billion yen (1983)

Percentage of craftspersons under
30 years old

6.1%

28.6% (1974)

Source: Association for the Promotion of Traditional Craft Industries, Japan http://www.kougei.
or.jp/english/ (accessed July 1, 2009). Table created by author.

The decline has presented serious economic and social repercussions for Japan’s traditional
craft work industry. The decline is obvious in the regions where large-scale traditional craftwork
industries have historically been located. For example, the volume of production per annum inYamanaka Lacquerware in Ishikawa Prefecture decreased from 40 billion yen in 1989 to 18.5
billion yen in 2001. This decrease in production volume can also be seen in Wajima City, a wellknown production region of lacquerware, decreasing its amount from 14.8 billion yen to 7.6 billion yen in the same period of time (see Figure 1).
Figure 1. Changes in the Production of Lacquerware: ThreeJapanese Locality Examples
45000
40000
35000
30000
25000
20000
15000
10000
5000
0

Yamanaka
Wajima
Kiso

1989

1992

1995

1998

2001

Source: Data collected from the Association for the Promotion of Traditional Craft Industries, Japan, http://www.kougei.or.jp/english/ (accessed July 1, 2009). Figure created by author.

The decrease in demand for traditional crafts has thus reached a state of crisis, shaking
the very foundations of the economic, social, and cultural livelihood of traditional Japanese
craftspeople. To counter this situation, measures aimed at promoting crafts domestically were
implemented by METI and local governments, according to the Law for the Promotion of Tra106

ditional Craft Product Industries enacted in 1974 and re-reformed in 2004. To date, the Ministry
has identified over 200 types of traditional crafts that must meet its five conditions (see Table 2),
and the Association for the Promotion of Traditional Craft Industries, the primary body backing
the craft making business, has certified over 5,000 master craftspeople.
Table 2. Five Conditions for Traditional Authorization
1

The article must be used mainly in everyday life.

2

The article must be primarily manufactured by hand.

3

The article must be manufactured using traditional techniques.

4

The materials should be mainly those which have been traditionally employed.

5

The industry must be of a regional nature.

Source: Association for the Promotion of Traditional Craft Industries, Japan, http://www.kougei.
or.jp/english/ (accessed July 1, 2009)

In recent years, the declining production value of traditional crafts has resulted in a sharp
drop in the number of practicing handicraft firms as well as craftspeople. Despite the implementation of rigorous promotional measures, the atrophy afflicting the craft making business has notbeen effectively stemmed. In order to prevent the decline and to urge development of the traditional craftwork industry, various attempts at revival have been linked with other industries suchas tourism and the development of innovative traditional goods all over Japan. The Association
for the Promotion of Traditional Craft Industries recognizes Japanese craft as more than just commodities to be sold; they believe that the attachment of individuality, fineness, expression, andaesthetic appreciation of Japanese ideals is essential to the production of handicrafts. It is critical
for the products to survive as reflected in this statement:
METI’s efforts to promote traditional Japanese crafts is [sic] done in the hope that theJapanese people as well as the people of the world do not forget the quality of handwork [sic] and keep a place in their hearts for the unassuming and innocent products
of direct human effort as well as the products of contemporary technology. Handmade
objects are not a thing of the past…but are our contact with something basic and profoundly precious.37
Outside of Japan, while the demand for Japanese crafts is somewhat limited, the demand forJapanese craftspersons to share or evaluate the level of craft of other nations has been notable.
The Council for Local Authorities (CLAIR) is among several agencies in Japan that has been themost active in pursuing opportunities for international cooperation projects that relate to traditional craft. CLAIR states:
International exchange between local governments has begun to move beyond international exchange and other exchanges of goodwill. Still building upon the established foundations of goodwill, local authorities are now actively developing international cooperation projects by making use of the special human resources andexpertise they possess.38
Since 1996, the goals of such cooperation activities have been well defined by CLAIR and
involve the cooperation of both Japanese and various Asian local governments, which state thatthe objectives of such cooperative projects should:
107

(1)
(2)
(3)
(4)

Be diverse and take advantage of unique regional characteristics;
Have increased citizen participation;
Be undertaken by local governments and their partners as equals; and,39
Be carefully crafted to meet the wishes of cooperative partners.

Recently, examples of some of the local cooperative projects have included: in 2007, JapanChina Friendship Forum in Kitakami; 2006, Japan Specialist Dispatch Project on Pottery in Cambodia; and 2004, the Kiso Lacquerware Cooperative.
6. Case Study: The Kiso Lacquerware Cooperative(1) Background and History
One type of protected craft that has a following outside of Japan is that of Kiso lacquerware.
In 1975 METI (then MITI) designated the craftsmen, the involved processes, and final productsof Kiso style lacquerware as traditional crafts. According to the local government in the Kiso Valley, Nagano Prefecture, lacquerware has been produced in considerable quantities for around 600
years. Unlike other lacquerware industries in Japan, this region produces large items of lacquerware including low tables, dining tables, screens, and folding screens. According to its remaining
craftspeople, the greatest distinguishing feature of Kiso Lacquerware is the way in which items
are lacquered in many layers and designs and painted in different colors of lacquer.40 A large
workforce of craftsmen produces unique pieces such as trays, lunch boxes, and tiered boxes,
making a major contribution to the economy of the region.
The idea for the Kiso Myanmar Cooperative came about in 1994, when the Myanmar Governor General, who oversees small and medium-sized enterprises, visited the village or Narakawa-mura and signed a statement of agreement for technical cooperation. The Narakawa-mura
village office then dispatched an exploratory commission to Myanmar, and beginning in 1998,
three delegations of master craftspeople were sent to impart their technical skills to local Myanmar craftspersons. In addition, trainees from Myanmar were sent to receive technical instruction
in lacquerware production at the Kiso lacquerware craft high school. In order to implement the
project, the lacquerware district in Kiso utilized a support system co-sponsored by the Ministryof Foreign Affairs, the Japan International Cooperation Agency, and the Council of Local Authorities for International Relations (CLAIR). Initially, this type of cooperation was part of theSpecialist Dispatch Project, an international cooperation project initiated by CLAIR.
Under the project, an employee (including retirees) of a Japanese local authority with specialized knowledge or experience is dispatched upon request from an ASEAN local government,
to improve technology in the local area, train local personnel, and promote friendly cooperative
relations between Japanese and ASEAN’s local governments. The main objectives of the Specialist Dispatch Program are to:(1) Survey the raw materials of the locality;(2) Observe the craftspeople at work to determine their skill levels, and also survey
commonplace problems in the traditional methods of manufacturing pottery in thevillage;(3) Provide training on craft techniques; and,(4) Offer training on marketing know-how: Participants are given insights into the importance of understanding local needs in order to market their products effectively.
As part of the series of cooperative schemes, the project put into effect strategies that involved local Japanese residents’ study trips to other countries and conducting elementary school108

classes aimed at raising global understanding. These served to raise appreciation among the Kiso
residents of the lacquerware that was produced.
Myanmar lacquerware is also thought to have had a long history of production, originatingfrom techniques imported from China in the 11th century. The techniques used in Myanmar production are similar to those of the Kiso craftsman’s (see Figure 3). Lacquerware production in
Myanmar is a cottage industry and there is a training school that was set up under the Departmentof Home Industry in the post-Independence period; it was upgraded to institute-level by the present government and trainees are recruited from around the area. They receive stipends and scholarship grants from the government. Myanmar’s Department of Tourism states, with the promotion of local and foreign tourism, the adoption of market-orientated economy and accession of
41
Myanmar into the ASEAN (in 1997), lacquerware making has become a thriving industry.”(2) Prospects and Challenges for the Cooperative
According to a CLAIR report, both the socio-economic impacts of the projects were numerous.”42 Additionally, the Myanmar government has stated that the partners in their country
seem to:have greatly appreciated the exchange program to dispatch technical instructors andto receive trainees, and [the cooperative project] is thought to be useful in improving
craft production skills. The fruits of the programs have started to show in the quality of
the lacquerware being produced. New buds of exchange have started to sprout such as
in future discussions for more overseas training.43
However, the Kiso Cooperative Project was not entirely without challenges. According to
CLAIR the Kiso project and future exchanges with Myanmar have been suspended because, As
it is a small-scale local governmental program, the greatest challenge is securing funds for thecooperative exchange programs.”44
With local government finances strained, financing is also difficult to secure at the village
office level. Moreover, the lacquerware making businesses are unable to identify any justifiableeconomic merits to the program. Also, due to the high value placed on Kiso Lacquerware domestically, Japanese officials have concerns about cheaper, lower quality Myanmar-made products
flooding the Japanese market as a result of the cooperation project. As for the expansion of lacquerware sales overseas, stable distribution channels have yet to be established.
(3) Is That All?: Future Strategies for Cooperation
While the cooperative was not entirely a success in terms of its economic outcomes for local
government officials, for CLAIR, the social and economic aspects are somewhat dependent upon
one another:
International exchange is regarded as the promotion of mutual understanding, withemphasis placed on human interaction. However, it’s becoming increasingly necessary
to consider such exchange in terms of its benefits to the regions, especially to regional
economies. Given this situation, it’s getting more important than ever to achieve specific outcomes in the activities of CLAIR. CLAIR will support in particular the promotion of economic exchange between local governments in Japan and those in ASEAN,
regions which are increasingly gaining the attention of Japan and the world for their
expected higher economic growth.45
For the artists and trainees involved in the cooperative, it is more that an economic prospect.
109

One craftsperson is quoted as saying, For Japan, I feel it is necessary to establish and respect
local cultures and values while engaging in global collaboration and systematization, teachingsomeone who is interested in my craft is a good way to do this.”46
Though the tension between the economic and the social will always exist, with economic
prospects first on the minds of officials, it is imperative to take an interest in the traditional craftsof the world, and approach the idea of traditional crafts with a global vision in order to foster thedevelopment of traditional crafts on a regional level. Craft can be a tool for this, as lacquerware is
produced in many of Japan’s neighboring countries and areas such as China, Taiwan, South Korea, Thailand, Myanmar, Vietnam, and Bhutan.
Owing to the exchanges with Myanmar, the local citizenry has acquired a better understanding of Japan, and the experiences gained have led to the development of new products.47 For
Japanese craftspeople, the sharing of techniques should not be a point of distress; rather, having
a point of contact with other cultures could breed ideas for new crafts. They may not find an answer to their dilemma by looking solely at the economic benefits of the exchange and its impacts.
There may be ways to thwart the influx of overseas products while building understanding of another’s identity, values and culture at the same time. Moreover, as Japan relies heavily on foreignsources of raw materials, the entire production process cannot be domestically self-contained.
There is a need to widen the scope of vision and draw together the respective energies of various
actors, and ideas for fostering the traditional craft industry should be generated from a regional
point of view; it is essential that the resulting measures also be implemented from that perspective.
The objective of these types of cooperation should not be wholly focused on economic outcomes or the setting up of institutions. Rather, emphasis should be on enhancing regional cooperation in terms of culture, promoting a better understanding of Asia’s civilization, arts, culture,and possibly a common craft heritage. Craft collaboration has the potential to promote mutual
respect and greater understanding of Japan and its neighbors’ diverse cultural backgrounds, tostrengthen the foundations for making a stronger, more cohesive, and more competitive Asian regional community. Further strategic objectives should also consider:(1) The support for intercultural dialogue within the region, by ensuring the preservation of cultural heritage and promotion of contemporary cultural productions.
(2) The fostering of cultural and artistic cooperation among regions with regard tocultural activities related to arts, architecture and literature, as well as the promotion of activities, namely, exhibitions and festivals; and,
(3) The promotion of cross border, bilateral, and multilateral cooperation among
countries.
Initiatives that keep these strategies in mind cannot help but create a community of common
values that exist for the preservation of cultural heritage as an instrument of social, human, andeconomic development.

7. Conclusion
A difficult challenge for Japan and East Asia in the twenty-first century is to transcend theeconomic aspects of regional integration and attempt to understand the identities, values, andcultures of its neighboring nations. This paper has argued that the emphasis thus far on Asian
regional integration has been placed primarily on issues of economics and politics and, from thatperspective, it has examined the possibility for regional collaboration in the form of traditional
110craft cooperatives.
The paper has proposed that economic ties may not only make an Asian identity stronger,
but they can also pave the way for a promising Asian community in which common values andcultural underpinnings are based on similarities in the production of traditional craft goods. Traditional craft embedded in identities, values, and cultures has the potential to enhance long-term
efforts towards community building, especially when economic integration takes place. It may bein the best interest of the countries involved to focus on the sharing of grassroots commonalties,
beginning with traditional goods that represent meaning and value.
However, future research and initiatives need to be undertaken to understand the concernsof the producers, craftsmen, and local organizations. Many questions remain to be explored concerning the role of identity, value, and culture. Whether and how much identity and value matteras an independent variable to regional integration is also a question that requires further inquiry.
Moreover, what constitutes an Asian identity, if anything at all? Additional study is also neededon the types of approaches that might be mutually beneficial for Japanese crafts and their cooperation partners, to protect their techniques and human resources so that they feel comfortable
sharing tradition.
A longer-term objective of future research might be to explore ways for Japan to collaborate
with its neighbors in the creation of crafts not necessarily unique to Japanese identity and pride,
but rather as emblems of a greater Asia that are engaging, appealing and profitable beyond Japanese shores. If that scenario were to come to fruition, it may create a more meaningful discourse
about the traditional crafts of Asia and not merely that of a single country. A new vision could bethat of a people-centered ASEAN, where cooperation, as opposed to solely government-driven
economic regional association exists. A regional awareness of identities and common values
would lead to regional cohesion and some level of cooperation among likely member states at thegrassroots level. There is hope. The governments of South Korea, Japan, and China agreed to celebrate 2007 as the year of cultural exchanges. In fact, many of the proposed cultural exchanges
on that occasion were based on pop culture exchanges, objects with meaning and identity acrossthe various regions.48 While continued economic prosperity will accelerate the development of regional integration, an understanding of a common culture or common identity will be susceptible
to domestic political whims if it does not surpass the elite level; there is greater strength whenvalues are shared by ordinary citizens throughout the region. Only then may the potential for true
regional integration be secured.

Notes
The research that was undertaken to write this research paper was funded by the University of Alberta,
ALES Support for the Advancement of Scholarship Grant, and travel funding to present the paper fromthe Global Institute for Asian Regional Integration (GIARI), at Waseda University. In particular, I would
like to convey my sincere gratitude for the opportunity to participate and present my initial findings at
the Summer Institute on Asian Regional Integration 2009. I would like to extend my gratitude to Professor Tsuneo Akaha of the Monterey Institute for International Studies/Visiting Professor at Waseda
University for his constructive and insightful comments which have proved so very useful during therevisions of this paper.
2 R. Robertson and A. King, Social Theory, Cultural Relativity, and the Problem of Globality, in Culture, Globalization and the World-System: Contemporary Conditions for the Representation of Identity,
Minneapolis: University of Minnesota Press, 1997, p. 69; A. Tomlinson and C. Young, National Identity
and Global Sports Events: Culture, Politics, and Spectacle in the Olympics and the Football World Cup,SUNY Series on Sport, Culture, and Social Relations, Albany: State University of New York Press,
2006.
3 T. Urushihara, The Prospects for Traditional Japanese Crafts. Economy, Culture and History, Japan
1

111

Spotlight Bimonthly, Vol. 23, No. 4 (2004), pp. 48-49.
M. Fujita, Economic Integration In East Asia: Perspectives from Spatial and Neoclassical Economics,
Cheltenham: Edward Elgar, 2008.
5 Ibid.
6 R. Higgott, The Theory and Practice of Region: The Changing Global Context, in D. Webber and B.
Fort, eds., Regional Integration in East Asia and Europe: Convergence or Divergence. Centre for the
Study of Globalization and Regionalization, New York: Routledge, 2006, p. 24.
7 S. Breslin, Theorizing East Asian Regionalism(s), in Melissa Curley and Nicholas Thomas, eds., Advancing East Asian Regionalism, Abingdon, Oxon, UK; New York: Routledge, 2006, pp. 27-30.
8 For example, L. Harrison, Who Prospers? How Cultural Values Shape Economic and Political Success,
New York: Basic Books, 2008.
9 Ibid.
10 I.M. Wallerstein, World-systems Analysis: An Introduction, Durham: Duke University Press, 2004.
11 S.P. Huntington, The West: Unique, Not Universal, Foreign Affairs, Vol. 75, No. 6 (1996).
12 H. Befu, Globalization Theory from the Bottom Up: Japan’s Contribution, Japanese Studies, Vol. 23,
No. 1 (2003), pp. 3-22.
13 H. Vaclav, The Need for Transcendence in the Postmodern World, The Futurist, July-August 1995, p.
47.
14 F. Fukuyama, The End of History and the Last Man, New York: Praeger, 1992, p. xiv.
15 B. Keillor and G.T. Hult, A Five Country Study of National Identity: Implications for International
Marketing Research and Practice, International Marketing Review, Vol. 16, No. 1 (1999), pp. 65-82.
16 B. Anderson, Imagined Communities: Reflections on the Origin and Spread of Nationalism, London and
New York: Verso, 1991.
17 P. Schlesinger, On National Identity: Some Conceptions and Misconceptions Criticized, Social Science Information, Vol. 26 (1987), pp. 219-264.
18 L.A. Despres, Towards a Theory of Ethnic Phenomena in L.A., in Despres, ed., Ethnicity and Resource Competition in Plural Societies, LaHaye-Paris, Mouton, 1975.
19 S. Hall, Questions of Cultural Identity, London and Thousand Oaks, California: Sage, 1996.
20 Befu, op. cit.
21 J. Liow and R. Emmers, Introduction, in Joseph Liow and Ralf Emmers, eds., Order and Security inSoutheast Asia: Essay in Memory of Michael Leifer, New York: Routledge, 2006.
22 P. Jehoon, T.J. Pempel, and G. Roland, Political Economy of Northeast Asian Regionalism: Political
Conflict and Economic Integration, Northampton: Edward Elgar, 2008, p. 52.
23 A. Acharya, Do Norms and Identity Matter? Community and Power in SEA’s Regional Order, in
Liow and Emmers, eds., pp. 81-83.
24 D. Rumley, The Geopolitics of Asia-Pacific Regionalism in the 21st Century, The Otemon Journal ofAustralian Studies, Vol. 31 (2005), p. 6.
25 N. Thomas, Regionalism Beyond an Elite Project: The Challenge of Building Responsive Sub-regional
Economic Communities, in Curley and Thomas, eds., p. 5.
26 M. Douglas, and B. Isherwood, The World of Goods: Towards an Anthropology of Consumption, New
York: W. W. Norton, 1979, p. 49
27 C.Y. Tilley, Introduction, in Tilley, ed., Handbook of Material Culture, London: SAGE, 2006, pp.
1-11.
28 Adapted from the definition for crafts/artisan products at the UNESCO/ITC International Symposiumon Crafts and the International Market: Trade and Customs Codification, Manila, Philippines, October 1997.
29 T.J. Schlereth, Social History Scholarship and Material Culture Research, in Schlereth, ed., Material
Culture: A Research Guide, Lawrence, Kansas: University Press of Kansas, 1985, pp. 155-195.
30 G. McCracken, Chapter 7: The Evocative Power of Things, in Culture and Consumption: New Approaches to the Symbolic Character of Consumer Goods and Activities, Bloomington: Indiana University Press, 1990, pp. 104-117.
31 M. Creighton, Consuming Rural Japan: The Marketing of Tradition and Nostalgia in the JapaneseTravel Industry, Ethnology, Vol. 36, No. 3, (1997), pp. 239-254.
32 Ibid.
33 W. Morris, On Art and Socialism: Essays and Lectures, London: J. Lehmann, 1947.
4112

M. Creighton, Nostalgia, Identity, and Gender: Woven in 100 Per Cent Pure Silk, in G. A. Hickey,ed., Making and Metaphor: A Discussion of Meaning in Contemporary Craft, Ottawa and Hull: The Canadian Museum of Civilization and The Institute for Contemporary Canadian Craft, 1994, pp. 100-113.
35 B. Moeran, Lost Innocence: Folk Craft Potters of Onta, Japan, Berkeley, CA: University of California
Press, 1984.
36 D.P. Martinez, Tourism and the Ama: The Search for a Real Japan, in E. Ben-Ari, B. Moeran, and J.
Valentine, eds., Unwrapping Japan: Society and Culture in Anthropological Perspective, Manchester:Manchester University Press, 1990, pp. 97-116.
37 http://www.kougei.or.jp/english/ (accessed July 1, 2009).
38 CLAIR: Local Authorities International Cooperation Promotion Projects (“Model Projects”), http://
www.clair.or.jp/e/sien/model.html (accessed July 1, 2009).
39 Ibid.
40 http://www.kougei.or.jp/english/ (accessed July 1, 2009).
41 Myanmar Tourism Promotion Board, http://www.myanmar-tourism.com/ (accessed July 1, 2009).
42 T. Urushihara, pp. 48-49.
43 Ibid.
44 Ibid.
45 http://www.clair.or.jp/e/forum/index.html (accessed July 1, 2009).
46 T. Urushihara, p. 49.
47 Ibid.
48 D. Leheny, A Narrow Place to Cross Swords: Soft Power and the Politics of Japanese Popular Culture
in East Asia, in Peter J. Katzenstein, ed., Beyond Japan: The Dynamics of East Asian Regionalism,
Ithaca: Cornell University Press, 2006, pp. 211-233.
34

113

Mireya Solis, Barbara Stallings, and Saori N. Katada, eds.,
Competitive Regionalism: FTA Diffusion in the Pacific Rim, New York:
Palgrave Macmillan, 2009.

Masato Kamikubo

1. Introduction
Competitive Regionalism: FTA Diffusion in the Pacific Rim is the first major publication thathas come out of the international conference on Competitive Regionalism, co-organized by the
Waseda University Global COE programme: Global Institute for Asian Regional Integration (GIARI) in May 2008.1
The objective of this book is to investigate the nature of the international trading system andthe future of regional integration, by focusing on the worldwide explosion of Free Trade Agreements (FTAs). In the past 15 years, the world trading system has been quickly transformed withthe rapid proliferation of free trade agreements (FTAs), whereby members make special exemptions to the most favored nation principle of the World Trade Organization (WTO) and exchange preferential market access commitments. In the second half of the 1980s and early 1990s,
the new regionalism emerged in the Western Hemisphere. The 1989 Canada-US FTA was thefirst manifestation of this phenomenon. Subsequently, Mexico negotiated an FTA with the UnitedStates, leading to the trilateral NAFTA (North American Free Trade Agreement) that marked
the turning point in the spread southward of the new type of FTA. In 1991, the four countries ofBrazil, Argentina, Paraguay, and Uruguay expressed the desire to create more outward-looking
economic integration agreements named Mercosur. In 2001, the United States shifted its trade
policy toward competitive liberalization, which is the negotiation of bilateral FTAs with certain
nations in order to stimulate talks on other trade fronts. With competitive liberalization, the active
FTA policies of the United States, Mexico, and Chile have driven a veritable boom of preferential
trade agreements in the hemisphere, as well as in Europe and East Asia. On the other hand, East
Asia was widely praised as a high performing region prior to the 1997 financial crisis. Nevertheless, since the late 1990s, East Asian countries have negotiated multiple FTAs, which accord
preferential market access, impose binding commitments, and embrace numerous WTO-plus
commitments.

2. Previous Studies on FTA Proliferation
In previous studies, there are three conventional views on FTA proliferation: economic interdependence; domestic lobbying and rent-seeking; and state autonomy. Several scholars, who
focus on economic interdependence, have argued that trade concentration is the most important
spark for regional integration, and integration in one sector increases pressure to integrate inother related industries (Haas, 1964; Mattli, 1999). The economic interdependence approach indicates that high levels of economic interdependence can energize the private sector to demandthat a regional economic governance structure transaction costs.
Several academics focus on the role of domestic lobbies in pushing for trade-diverting
FTAs that yield rents for specific producer groups. Baldwin (1997), for example, has advocated a114

domino effect model which describes how negotiation of trade-diverting agreements triggers achain reaction of subsequent FTA enlargement or negotiation of alternative trade blocs, as disadvantaged non-member producers seek to minimize the trade and investment diversion caused byprevious FTAs. The domestic lobbying model indicates that industries can lobby for FTAs thateither offer rents through preferential market access or aim to dissipate these rents by negotiating
countervailing FTAs.
The state autonomy approach argues that states consent to pool sovereignty via regional
integration to achieve joint gains that cannot be realized with pure national measures, or to gain
leverage over domestic interest groups (Moravcsik, 1993). In this model, governments can be
firmly in control of the integration agenda and use these agreements to gain leverage over domestic interest groups.

3. New Perspectives on FTA Proliferation: Emulation and Competition
Competitive Regionalism: FTA Diffusion in the Pacific Rim firstly evaluates the above
three approaches in previous studies. Initially, the book finds that economic interdependence is,in fact, a poor indicator of shifts in favor of regionalism. For example, intra-regional trade has
consistently been higher for East Asia than for North America (as of 2003, 54% in East Asia and
46% in North America), and yet the United States, Canada, and Mexico moved much faster tonegotiate the regional trade agreement (NAFTA) than the nations of East Asia. Next, this bookcriticizes that the trade-diversion motive can only explain a subset of such FTAs. For example,
Japan firstly concluded a preferential trade agreement with Singapore, but this accord was not
informed by the desire to counter trade diversion since Singapore was already one of the mostopen economies in the world. Finally, this book points out that the state autonomy approach’s
narrow description of regionalism as a series of discreet summitry events leaves out ongoing processes (market exchange), assumes away problems of implementation of high-level official bargains, and fails to explain the reasons behind the convergence of regional integration preferencesamong key members. The book also observes that states are not interested only in supplying an
integrated governance structure to lower risk and transaction cost, but they also try to achieve
other economic, security, and diplomatic goals.
This book agrees that Baldwin’s domino effect has addressed the issue of FTA proliferation
most effectively by highlighting how trade and investment diversion effects from initial FTAs cangenerate a chain reaction of subsequent preferential trade agreements. Thus, this book assumes
that a government’s decision to pursue this policy innovation is influenced by the actions of othercountries and is not determined purely by domestic factors.
The book presents the concept of emulation and competition. It considers the interplay ofmultiple competitive objectives in FTA negotiations, which go beyond the defensive economic
interests of the domino theory and include regional leadership contests and dissemination ofalternative standards in regional integration. Also, this book assumes an alternative hypothesis
about FTA proliferation, which focuses on the role of ideas or policy paradigms as countries
emulate successful FTA strategies of leading reference nations. Moreover, the volume examines
more directly how domestic policy formation processes influence the manner in which governments respond to external diffusion pressures.
After clarifying the concepts of emulation and competition, the book proceeds to draw threetestable hypotheses: non-diffusion hypothesis, emulation hypothesis, and competition hypothesis.
The non-diffusion hypothesis states that a country’s decision to launch an active FTA policy is
not affected by the prior decision of other countries to negotiate preferential trade agreements.
In the emulation hypothesis, a country is assumed to have copied others based on their close so115

cial and policy connections and therefore should negotiate similar FTAs with as many partners
as possible. The competition hypothesis posits that countries will counteract the FTA policies of
their competitors. It assumes that a country moves toward FTAs due to competitive pressures in
economic (market access, investment promotion, and averting losses), political (diplomatic considerations and political rivalry), and/or legal (standard setting and rulemaking) spheres. According to this hypothesis, the country then negotiates agreements on a carefully targeted basis withdifferent terms depending on the partner.
Through examining the above three hypotheses, this book illustrates an alternative explanation for FTA diffusion with markedly different expectations about the nature of regional integration. This book argues that if competition is the dominant force behind diffusion, the recent FTA
proliferation is expected to work against the emergence of coherent regional integration projects.
Competitive pressures are multifaceted and should be disaggregated into different types of competition ranging from economic to political and legal. Also, this book claims that if emulation
prevails, it is anticipated that bilateral FTAs will be supportive of region-wide integration efforts.

4. The Three Thematic Chapters
The book confirmed that the competition and emulation hypotheses have significant implications for a bedrock expectation in the FTA literature: that these preferential trade agreements
promote regional integration. Instead, this book argues that if competitive incentives behind FTA
proliferation predominate, these preferential trade agreements may weaken the emergence of coherent trade blocs in several ways. This book presents three thematic chapters, and they identify
important sources of economic, political, and legal competition.
(1) Economic Competition
The book points out that FTAs offer interest groups and governments the ability to get ahead
in international economic competition in several different ways: preferential trade and investment
access, onerous rules of origin for non-members, targeting of rents for investors and exporters
while maintaining the mantle of protection for uncompetitive sectors, and concession linkage tosecure better deals in subsequent trade talks.
In Chapter 2, Shujiro Urata comments on the theories of economic determinants of FTAs
and empirical analyses of the welfare impacts of these agreements. Through the review of theprevious studies, he finds that defensive economic motives (the perceived need to counter trade
diversion) have largely driven the FTA wave in East Asia. In particular, Urata emphasizes that
this competition has been most acute between Japan and China.
In addition, Urata contrasts economic motivations with respect to FTAs between those thatare included and those that are excluded. He points out that FTAs are relatively important forsmall countries that try to become large as they eliminate cross-border trade barriers throughFTAs. On the other hand, he explains that for large countries, the impact of FTAs in increasing
their size is limited, although they do benefit from improving terms of trade.
(2) Political/Security Competition
The book indicates that FTAs are also pursued to achieve non-economic foreign policy objectives. More specifically, the book argues that FTAs can establish closer economic links withsecurity partners by employing the trade agreements as confidence building measures vis-à-vis
rivals, or by using them instead to isolate competitors by excluding them from economic cooperation agreements negotiated with other nations. Consequently, FTAs can influence interstatealignment patterns.
116

In Chapter 3, by using the insights of major IR traditions (offensive/defensive realism andcommercial liberalism), Mike M. Mochizuki explores the political-security dimensions of FTA
proliferation in the Asia-Pacific. Mochizuki explicitly distinguishes between large countries (theUnited States, China, and Japan) and a smaller one (South Korea) in terms of the use of FTAs
as a foreign policy strategy. He finds that FTAs have not been used by the large powers among
themselves to counter competitive pressures, and they have instead signed FTAs with smaller
states to hedge against negative security trends. So far, large powers have competed against eachother to prevent the predominance of any hegemonic FTA project. Meanwhile, Mochizuki indicates smaller countries often use FTAs to reduce their perceived security vulnerability.
(3) Legal Competition
This book asserts that some countries have incentives to compete through their FTAs in thedefinition and dissemination of new rules in international trade. The reason for this is that the
WTO has faced difficulties in adopting trade rules on new issues, such as investment protection, competition policy, and labor or environmental standards.
In Chapter 4, Junji Nakagawa first reviews the influence that the failure of multilateral rulemaking through a stagnant Doha Round and the collapse of the multilateral agreement on investment had in persuading East Asian nations to join the global trends of regionalization and legalization. He argues that the major players in rule and standard-setting in trade and investment havechanged their strategy from the multilateral forum to bilateral and regional forums to pursue theirbottom-up rule-making in areas such as antidumping, trade facilitation, and intellectual property rights.

5. Country Chapters
Following the three thematic chapters, this book reviews countries engaging in FTAs. The
country chapters in this book examine how diffusion dynamics influence the FTA policies ofcountries on both sides of the Pacific Rim.
In Chapter 5, Cintia Quiliconi and Carol Wise discuss the competitive liberalization campaign that the United States launched in the early 2000s to achieve key competitive goals: thedissemination of new rules on trade and investment that could be adopted later at the multilaterallevel, which in the Western Hemisphere generated a coalition of the willing, as only a subset of
Latin American nations were willing to endorse the US-proposed FTA formula; and preventing
China’s domination of the regional integration process in East Asia.
In Chapter 6, Barbala Stallings examines how Chile adopted an autonomous FTA strategy,
putting it to a distinct political use in the early 1990s by reintegrating itself into the region after
long years of authoritarian rule. Economic competition was also of great importance to Chile visà-vis emerging Latin American markets; Chile attempted to capture FDI inflows from industrialized nations and to strategically place itself as a bridge between East Asia and South America.
Chile actively used FTAs not only to expand its market access and investment potential, but also
to regain its legitimacy in the Latin American region after a long period of military dictatorship.
In Chapter 7, Aldo Flores-Quiroga investigates the Mexican business community’s attempt to put
pressure on NAFTA in order to secure market access and investment flows in a bottom-up manner.
In East Asia, Singapore has played a key role for the region’s adoption of an FTA strategy.
Singapore shares common traits with Chile in that the two countries are relatively small and vulnerable to the external economic and political environment. They have decided to utilize FTAs
to help mitigate these vulnerabilities. In Chapter 8, Takashi Terada discusses the political and117

economic uncertainty in the region after the Asian financial crisis, which also stalled the ASEAN
integration movement and encouraged Singapore to venture into FTA negotiations with advanced
countries, such as the United States and Japan. Singapore exerted competitive pressures on otherlarge ASEAN countries to follow suit, and ASEAN as a grouping has attempted to become an
FTA hub. Also, Singapore tries to overcome its security vulnerability, strengthen its economic
ties and facilitate mutual economic benefits and business transactions through FTAs.
In Chapter 9, Min Gyo Koo observes that Korea’s more moderate attempts to emulate the
FTA policies of other countries soon gave way, under the Roh Moo-hyun administration, to aproactive FTA strategy of negotiating with the United States and the EU. According to the author,
while the top-down policymaking process allowed this policy shift, Korea has faced a domestic
backlash (as in the United States), and its campaign to become an FTA hub of the region has been
hindered. Koo argues that the Kim Dae-jung administration learned lessons from other countries
after the Asian financial crisis. For example, the author mentions that the South Korean government launched an FTA with Chile to learn negotiating techniques that would be useful in later
agreements.
In Chapter 10, Mireya Solis argues that Japan has utilized FTA policy to offset trade andinvestment diversion from other FTAs, to disseminate its own FTA formula in East Asia, and tocompete with China in cementing relations with Southeast Asia. However, the Japanese government has faced a major dilemma: whether to negotiate a bilateral FTA with China to maximize
economic gains, or to emphasize political competition and develop rival FTA networks in the region.
In Chapter 11, Jian Yang argues that China is keen to emphasize the absolute gains fromtrade liberalization, but its selection of FTA partners and the timing of trade negotiations showthat competition, both economic and political, is driving the Chinese strategy. According to theauthor, China is economically using its FTAs to enhance the efficiency and productivity of domestic enterprises and to promote the international acceptance of China as a market economy.
Also, the author states that China is politically using FTAs as an important instrument in its pursuit of influence and security goals.
In the country chapters, this book looks for evidence of patterns regarding how large andsmall countries respond to FTAs and prioritize economic and political/legal interests behind FTA
engagement. The country chapters illustrate that as FTA development enters a competitive stage,economic competition becomes the predominant concern for smaller countries with weaker bargaining power, such as Chile, Mexico, South Korea, and Singapore. Those countries have preferred countries that have large markets as FTA partners, especially the United States, but also the
EU and Japan.
The country chapters indicate that for the large countries, such as the United States, Japan,
and China, the motivation for their aggressive FTA policies includes both economic and non-economic goals. For instance, China chooses FTA partners based on their willingness to recognize
China as a market economy. Also, the United States has been promoting its political and legal
agendas through multiple FTAs with small countries, in addition to economic gains in trade access vis-à-vis relatively large countries in Asia. By contrast, an important international concern isthat the existing markets in Japan are closed to foreign producers and exporters. Simultaneously,
the Japanese government is subjected to the pressure of the country’s uncompetitive domestic
sectors, particularly agriculture, so that it cannot engage in FTAs with countries such as the United States or China that threaten those sectors.
The studies demonstrate that for large states with hegemonic ambitions, pressures of political and legal competition are particularly important reasons to engage in FTAs. Most of the FTAs
involving the United States, from the early accords with Israel, Canada, and Mexico to the laterones with Asian countries, have been driven by Washington’s security and political interests and118

concerns. The United States has utilized FTAs to solidify or strengthen its security relations with
distant countries such as Singapore and South Korea. At the same time, the United States has felt
pressures from China’s increasingly active pursuit of FTAs both in East Asia and in Latin America.
According to the chapters, for large countries, the dissemination of their own models of economic integration is also important. For example, Japan and China are rivals in their active pursuit of FTA negotiations within the Asian region. Both want not only to demonstrate their tradeleadership but also to establish their own model of FTA standards.

6. Conclusion
In short, this book analyzes both emulative and competitive dynamics promoting FTAs in
the countries studied. In particular, the volume shows that emulative diffusion can influence thecountries’ trade strategy in the early stages of FTA policy cycles. Competitive pressures start tomount at a later stage as FTAs spread throughout both the Western Hemisphere and the Asia-Pacific region, which trigger more aggressive and targeted FTA strategies and negotiations among
the countries reviewed.
One shortcoming of this otherwise excellent collection of studies is that, although the bookemphasizes the importance of domestic political elements to the countries’ FTA policy, it is unclear how domestic political elements, including the power of so-called veto players, accelerate
the countries’ response to emulation and competition pressures on FTA negotiations. Instead,
it can be said that these elements hinder movement toward FTA negotiations. For instance, thedomestic agricultural opposition in Japan has constrained the Japanese government’s options interms of its FTA partners and the speed at which the country can pursue FTAs.
The above limitation notwithstanding, this book’s suggestion that emulation and competitive hypotheses were at work in different countries and at different stages of FTA engagement is avery important contribution to the study of the international trading system and regional integration.

Note
1

The International Symposium Competitive Regionalism was held in Ibuka International Conference
Hall, Waseda University, Tokyo, Japan, May 30-31, 2008.

References
Baldwin, R.E. (1997) The Causes of Regionalism. The World Economy, pp. 865-888.
Haas, E. (1964) Beyond the Nation-State. Stanford: Stanford University Press.
Mattli, W. (1999) The Logic of Regional Integration: Europe and Beyond. Cambridge: Cambridge
University Press.
Moravcsik, A. (1993) Preferences and Power in the European Community: A Liberal Intergovernmental Approach. Journal of Common Market Studies, Vol. 31, pp. 18-85.

119Vinod K. Aggarwal and Shujiro Urata, eds., Bilateral Trade Arrangementsin the Asia-Pacific: Origins, Evolution, and Implications, New York:
Routledge, 2006.

Jemma Kim

1. Introduction
The new wave of regionalism has become an important feature of global political economy
today. Since the 1990s, the number of bilateral or regional free trade agreements (FTAs) that havebeen signed has increased dramatically. In the Asia Pacific region, for instance, countries like theUnited States, Canada, Mexico, and Chile have pursued FTAs as one of their trade policy options
since the early 1990s. Christopher Dent (2003) has called the sudden proliferation of regional bilateral free trade agreements one of the most important recent developments in the Asia-Pacificregional political economy.”1 Baldwin (1995) points to the existence of a domino effect interms of FTAs from the second to the early third wave. Mansfield and Milner (1999) identify acontagion effect. While the number of FTA agreements has also surged on a global level since
the early 1990s, the rapid increase in FTAs in the Asia-Pacific is particularly noteworthy given
the relative dearth of such arrangements in the region before the 1990s.
Regarding East Asia, despite the diffusion of the FTAs, known as the third wave”2 in the
1990s, the region was characterized by a near absence of formal FTAs and regional institutions.
Among East Asian countries, Japan and Korea pursued a single-track approach for almost fifty
years, focusing their trade negotiation efforts exclusively on the multilateral forum while shunning regionalism as harmful to the GATT/WTO system. However, both governments today are
actively and strategically pursuing bilateral FTAs with their trade partners. East Asia was engaged in 120 FTAs (including those under negotiation or study) as of 2009, and there are more to
come.
Several questions arise. Why do countries pursue regional trade strategies, instead of relying solely on unilateral or multilateral ones? Will this new wave of regionalism be benign ormalign? How is Asia-Pacific bilateralism likely to evolve over the next decade? To address thosequestions, there have been several reviews of research on FTAs in the field of IPE (Mansfield andMilner, 1997 and 1999; Hurrell, 1995; Yamamoto, 1997; Yamakage, 1983), but they did not generally focus on the transformation of FTAs beginning in the 1990s.
Drawing on the institutional bargaining approach (pp. 13-16, p. 280; see also Aggarwal 1998
for a more detailed discussion of bargaining games), in this outstanding book, Aggarwal and Koo
address the above questions. The volume analyzes the rise of bilateralism in the Asia Pacific region with a view for understanding the origins and rapid evolution of these arrangements, and forcomprehending their potential economic, political, and strategic impacts on regional economic
relations.
The main aim of this book is to extract lessons from the empirical analyses of the politicaland economic factors that have driven Asia-Pacific bilateralism, and the implications of these arrangements for broader trading arrangements. The examination is conducted from theoretical,
institutional, and empirical perspectives. The volume contains detailed case analyses of the trade
strategies of nine countries: Japan, China, Singapore, South Korea, Malaysia, Taiwan, Thailand,
the United States, and Mexico.
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This book examines the negotiations of bilateral trade accords in the Asia-Pacific with specific attention to the following three questions (p. 4): (1) Why does bilateralism develop? How
does the context of informal and formal trade relationships drive the formation of bilateral agreements? (2) How will bilateralism evolve? What are the different paths that bilateralism mighttake? Will it be deepening or widening? Trade diverting or trade creating? (3) How will bilateralism affect other types of trade arrangements? Will it play a complementary or substitutive role?
Will conflict arise among different accords and spill over into broader political relations amongstates? Answers to these questions are sought through the analytical framework of the institutional bargaining game approach.

2. Theoretical Framework and Economic Overview
Part I consists of three chapters that deal with theoretical and institutional perspectives. In
Chapter 1, Vinod Aggarwal develops the theoretical framework for the book. He addresses twoquestions. First, how might one categorize bilateral trade agreements in the broader context ofthe possible array of arrangements that might be used? Second, how can one explain the origins,
evolution, and impact of bilateral accords? He argues that the motivations for concluding bilateral trade agreements have varied widely among countries, and simple economic welfare analysis
does not adequately explain the rise of such accords. He incorporates political factors into his analytical framework. Regarding the political forces driving bilateral trade arrangements, Aggarwal
focuses on four factors: the role of pressure groups, regime types, ideas, and international context. He also highlights the role of some types of external shocks. According to him, the pressure
for a shift toward new Asia-Pacific bilateralism came about through three external shocks. First,
broader security shifts such as the end of the Cold War made it politically easier for Asia-Pacificcountries to pursue bilateral FTAs with each other. Second, against the backdrop of the unprecedented economic hardships for the small and medium-sized economies in the region during thelast years of the 1990s, many of those countries came to recognize that tighter institutionalization rather than loosely-structured regional production networks might be a better commitment
mechanism for providing economic security. Thirdly, the Seattle meeting of the WTO and thebreakdown of the September 2003 WTO meetings in Cancun created fears that the multilateral
trading system would not continue to function. Also, Aggarwal notes that the characteristics of an
initial bilateral agreement and its possible expansion in scope will be critical to how actors perceive their relationship to broader agreements. Countries’ changing perceptions regarding the importance of supporting multilateral institutions have affected the choice of bilateral mechanisms.
Many Asia-Pacific trade experts now are part of an epistemic community, which shares theview that bilateral agreements can be trade enhancing and serve a similar purpose to multilateral
trade liberalization.
In Chapter 2, John Ravenhill looks into both the economic and political implications of
FTAs on potential and existing, regional and global trading arrangements. Specifically, he argues
that bilateral accords may well diminish prospects for future regional or global negotiations,and that both APEC and the WTO are likely to be negatively affected. He notes that the extent
to which bilateral preferential agreements are consistent with Article 24 of the GATT/WTO will
greatly influence the degree to which they might be disruptive to the broad-based trading system. Ravenhill provides a detailed analysis of how the exclusion of sectors in the accords undernegotiation may affect the domestic balance of power, and thus change the political atmosphere
for negotiating further agreements. He suggests that while such agreements provide governmentswith political benefits, the agreements create a new structure of protectionism that may harm consumers, create trade diversion, and encourage further lobbying by those who manage to secure121exclusion from bilateral liberalization efforts. He notes that some analysts believe that liberalization along bilateral lines may lead to the strengthening of pro-liberalization forces, which may
then foster overall market opening. He argues that piecemeal liberalization is likely to undermine
the creation of a broad coalition for opening trade by giving pro-liberalization lobbyists what
they want through sector-specific agreements, thus diminishing their incentives to lobby against
protectionist interests.
In Chapter 3, Fukunari Kimura deals with the economic motivation for bilateral trade agreements in the Asia-Pacific. Drawing on the development of international production and distribution networks as an important aspect of economic development in the region, he argues that FTAs
in the region are oriented toward increasing the competitiveness of previously protected sectors invarious countries while simultaneously enhancing production networks. He presents an economic
overview of Asia-Pacific bilateralism. He examines five aspects of FTAs: (1) the economic motivation driving bilateralism; (2) the role of international production and distribution networks ineconomic development; (3) the effects of FTAs on development strategies; (4) the limitations ofcomputable general equilibrium (CGE) model simulations; and (5) future prospects for broader
bilateral accords. Kimura notes that although FTAs have been developed on a bilateral basis forthe most part, the common view in the Asia-Pacific is that these efforts will ultimately result in
economic integration of the entire East Asian region. As latecomers to FTA formation, according to the author, East Asian countries share several distinct elements that have characterized
their efforts in developing bilateral FTAs. These include: pressure to formulate FTA networks
quickly; motivation from external rather than domestic sources; and the advantage of learningfrom the experiences of other regions. Aided by fragmentation, agglomeration, and internationalization theories, Kimura demonstrates the importance of production and distribution networks
in East Asia by citing a case study on the machinery industry’s production/distribution network
involvement. The analysis provides insight into the future prospects of Asia-Pacific FTAs. If East
Asian countries are to continue towards region-wide integration, Kimura argues, several policies
must guide the construction of FTAs. These include trade liberalization with minimal exceptions,forming bilateral FTAs with wide scope, learning from the experience of other regions, and utilizing other policy modes. The author concludes that this approach will allow bilateral accords tofoster broader Asia-Pacific arrangements.

3. Case Studies
Part II offers nine case studies of bilateral trade arrangements involving China, Japan, theUnited States, South Korea, Malaysia, Thailand, Taiwan, Singapore, and Mexico. They address
three common questions: What are the underlying political and economic factors driving these
accords? What are the implications of these arrangements for broader trading arrangements? To
answer these questions, each case study explores implications of the FTA policy and policy making for the theoretical and institutional explanations discussed in Part I, as well as the practicability of FTA multilateralization mechanisms.
Each chapter is similarly structured for a comparative analysis with an eye for understanding the different political and economic factors driving bilateralism in the region. Each case study
begins with a general overview of the trade policy of each country/area analyzed as well as an
overview of the bilateral agreements. It then examines both the economic and political factorsthat have driven the ultimate agreements. Each case study also provides an in-depth analysis of
one or more bilateral agreements to provide readers with a more precise understanding of different countries’ strategies.
In Chapter 4, T.J. Pempel and Shujiro Urata focus on the structural reform agenda. They122

predict that FTAs would force non-competitive sectors to face difficult structural adjustments. In
the presence of a dualist Japanese economy of protected inefficient firms and highly competitive
exporters, the political cost of liberalizing the protected industries has been prohibitively high.
Yet in the face of worldwide proliferation of FTAs, Japanese ministries with a structural reform
agenda have argued that Japanese exporters are being damaged by these trends. According to theanalysts, the Ministry of Economy, Trade and Industry and the Ministry of Foreign Affairs arepressing for FTAs as devices to bolster national economic restructuring in a more palatable manner due to their gradual impact rather than the alternative of sweeping domestic reforms driven
by multilateralism.
In Chapter 5, Richard Feinberg examines the FTA policy of the United States, the most influential country in shaping the direction of multilateral trade regimes. The author argues that theUnited States has begun to dramatically shift its position on trade negotiations. Under the newrhetoric (Robert Zoellick’s idea) of competitive liberalization, the United States is currently
mobilizing different types of trade arrangements, unilateral, bilateral, regional, transregional, andglobal. He notes that a consensus that FTAs advance US interests domestically and internationally has emerged within the policy circles in Washington.
Elaine Kwei analyzes China’s FTA policy in Chapter 6. She argues that the course of China’s bilateralism is informed by the interaction of four logics: (1) China believes that its futurelies with multilateral or minilateral regional frameworks rather than strictly bilateral options; (2)as a highly attractive market with economic leverage, China is more likely to pursue multilateralor minilateral trade arrangements, especially one-to-many deals, while taking advantage ofprivate and informal overseas Chinese business networks; (3) China will not completely discard
bilateral options as long as it can exercise control over the process; and (4) China is interested
in bilateralism primarily for political rather than purely economic motives, as illustrated by the
inclusion of confidence and security enhancing measures in the China-ASEAN FTA frameworkagreement. Based on this analysis, Kwei points out that China is more inclined to pursue FTAs
for their political benefits rather than for economic reasons, while at the same time continuing topursue broader trade arrangements.
Min Gyo Koo focuses on the trade policy shift of South Korea’s FTAs in Chapter 7. He analyzes Korea’s trade policy change from multilateralism as the first priority to the promotion ofbilateral FTAs including a multidimensional trade strategy. Koo argues that the socio-economic
restructuring that followed the financial crisis of 1997 has resulted in a new internationalist social
coalition that overshadows protectionist interests, particularly in agriculture and import-competing industries. He stresses the importance of the political leadership change, especially reformminded Kim Dae Jung’s presidential appointment in 1998, as the most crucial factor behind thepolicy shift.
In Chapter 8, Roselyn Hsueh examines Taiwan’s troubled attempts to form FTAs with its
natural trading partners, which have run into obstacles raised by China’s opposition; according to the author, for Taiwan’s trading partners, there are few economic and political incentives torisk economic and political retaliations with China by forming an FTA with Taiwan. Hsueh points
out that, for bilateralism to be of any consequence for Taiwan, Taiwan has to find a new politicalformula that makes China more tolerant toward its bid for bilateral FTAs.
Skeungjoo Lee, in Chapter 9, discusses Singapore’s two-track strategy for trade liberalization. Singapore’s efforts at bilateral FTAs clearly mark a fundamental shift in its trade policy,
which had hinged upon multilateralism and close ties with ASEAN members for the last four decades. Lee argues that a strong political leadership of former Prime Minister Goh Chok Tong andthe institutional strength of the Ministry of Trade and Industry have been essential in making possible the policy shift to bilateralism, with domestic interest groups and foreign companies playing
only a secondary role.
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Kozo Kiyota examines in Chapter 10 why and how the incumbent populist government ofThailand led by Prime Minister Thaksin Shinawatra began to seek trade and investment expansion through FTAs beyond ASEAN. He argues that Thailand’s new interest in FTAs is a result ofpolitical leaders’ response to growing domestic pressure due to economic stagnation. According
to the analyst, international factors influencing the nation’s policy include the stalemate in AFTA
negotiations and competition with Singapore and China for new FDI. He points out that the combination of an AFTA and bilateral FTAs will be more beneficial to Thailand than geographicallydispersed minilateral trade agreements.
In Chapter 11, Yumiko Okamoto analyzes Malaysia’s surprising policy shift from multilateralism toward bilateralism. Okamoto notes that because tariff rates between Malaysia and its prospective FTA partners are relatively low, the reduction of tariff alone may not create substantial
trade and investment. Instead, Okamoto predicts, Malaysia will gain from trade and investment
liberalization in the service sector.
Ralph Espach, in Chapter 12, focuses on the economic and institutional rationale for Mexico’s bilateral trade agenda. He argues that Mexico’s recent efforts at bilateral FTAs with East
Asian countries are a logical extension of its long-term program for economic liberalization in
the Western Hemisphere. The motivation for bilateral talks has increased as efforts at the multilateral and regional levels have slowed down or faced significant impediments. Espach predicts
that bilateral FTAs with East Asian countries are not likely to significantly diminish Mexico’s
deepening economic ties with the United States.

4. Key Findings
Part III concludes the volume. Following the examination of theoretical and institutional
factors for FTA formation and proliferation in Part I, and the concrete case studies in Part II,
Chapter 13 suggests the implications. Using the empirical results from the case studies, Aggarwal
and Koo summarize their key findings and their implications in three aspects (p. 292): (1) How
should one evaluate the extent to which the trade policy of individual Asia-Pacific countries has
evolved toward bilateralism over the past several years? (2) Of the three economic motivations
including trade expansion, investment expansion, and financial cooperation, which is more important in determining individual countries’ move toward bilateralism? (3) Of the four politicaland institutional factors, interest groups, political institutions, ideas, and international balance ofpower, which one is the most important driving force toward bilateralism and which one is theleast important?
With regard to the first question, Aggarwal and Koo conclude that the most striking featurein the Asia-Pacific bilateralism is that small and medium-sized countries―particularly Singapore, Mexico, South Korea, and Thailand―have played a central role in setting the pace towardbilateralism. The authors add that the new Asia-Pacific bilateralism has resulted from a bottomup rather than top-down strategy of small and medium-sized countries, as opposed to the postwar multilateralism that was largely imposed form the top (the United States) down to US allies
in the region.
On the second question, the two authors observe that for the United States, China, and Thailand, facilitating the inflows and outflows of foreign investment is the number one consideration
concerning bilateral FTAs. For other countries, expanding trade in goods and services through bilateral FTAs is the highest priority when they negotiate bilateral FTAs. For all the nine countries,
Aggarwal and Koo conclude that financial cooperation appears to be the least important economic incentive.
Regarding the third point, Aggarwal and Koo maintain that for the majority of the countries124

(six out of nine) selected for case studies in this book, political leadership and institutions are themost important driving force. For the United States, according to the authors, the new view ofbilateralism as a building block rather than a stumbling block for multilateralism is the most important determinant. As for the two Chinas, international balance of power is the most importantfactor that drives their somewhat slow move toward bilateralism. The authors also note that interest groups play a relatively minor role in the politics of new bilateralism. It is in conflict with Solis’ (2009) argument that Japan’s fragmented decision making process, or patterned pluralism,gives interest groups influence over the direction of Japanese trade policy. In fact, interest grouppolitics appears to be the least significant factor in five countries and the second least important
for two countries out of nine analyzed in this volume. This implies that new bilateralism is driven
from the top at the national level. In addition, these findings are closely related to the emerging
consensus at the political leadership level that FTAs will advance national interests while presenting an alternative road to trade liberalization compatible with multilateralism.

5. Conclusion
Based on the above observations and the implicit and explicit suggestions presented by eachchapter, common features are derived: the relatively small economic impacts of the agreements,
the importance of political factors in choosing negotiating partners, and the fear of being leftout amidst the burgeoning waves of FTAs in the Asia-Pacific. Similarly, Mansfield and Reinhardt (2003) have argued that countries may develop FTAs in order to obtain bargaining leverage
within the multilateral regime.
On the fear of being left out, for example, for Korea at the initial stage of FTA policy
development, the main drive was to prevent isolation from falling behind the tide. The Japanesecase also shows that one of the main reasons for pursuing FTAs has been that everyone else isdoing it. According to Okamoto (2003), Japan has been particularly motivated to seek FTAs
when major economic powers such as the United States and China are involved in FTA arrangements. Christopher Dent (2003) also has observed that the new FTA trends can be understood interms of FTA catch-up. Mansfield and Reinhardt (2003) have argued that countries may develop FTAs in order to obtain bargaining leverage within the multilateral regime.
In international political economy, whether the recent surge of the third wave of FTAs
promotes or hinders multilateral liberalization remains unclear. Whether bilateral FTAs and multilateral trade agreements such as WTO and APEC are compatible has long been a topic of heateddebate. As Ravenhill notes, there are sharply competing views on bilateral agreements, whether
they are possible stepping stones or stumbling blocks to broader accords. There is noted
concern over the implications that signing FTAs will eventually have for region-wide trade agreements. Indeed, once a number of different FTAs are set up, it would get technically complicatedand costly to establish a single regional multilateral FTA because each FTA may have different
rules of origin, exclusion lists, and external tariffs. How to induce convergence towards harmonized rules and standards among the web of FTAs will become an issue that needs to be resolvedon the road to an East Asian free trade area, if it is to come in the future. For now, the questionof why bilateral forms of FTAs rather than multilateral arrangements are burgeoning seems to beanswered by political explanations, such as those offered in the book reviewed here. This volume
cautions that there is a real danger that Asia-Pacific bilateralism will likely lead to pernicious,
conflicting arrangements, rather than becoming nested within broader institutions. To make thefuture of Asia-Pacific bilateralism stable, conscious efforts of coordination among the countries
concerned are very important.

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This reviewer finds three possible points for further research. Firstly, there are theoreticalcontributions that can be made to the study of FTAs and international political economy. Recent
literature on FTAs has focused on economic explanations for their attractiveness to governments.
For example, FTAs are considered a vehicle for promoting deeper integration of economies orfor dealing with trade-related issues such as investment and competition policy, and as an instrument for making economies more attractive to foreign investors. Contrary to those conventional
explanations, by bringing in political and institutional factors, both domestic and international,
as a key part of the explanation, this book provides us with considerable analysis showing thatthe motivations and implications in concluding bilateral FTAs vary widely among Asia-Pacificcountries and that static economic analyses alone cannot adequately explain the growth of suchaccords.
Secondly, the institutional bargaining approach developed by Aggarwal and Koo in this bookprovides a more systematic basis for examining both policy choices and connections among different types of arrangements. Their approach focuses on goods, countries’ individual situations,and the fit with existing arrangements. With respect to goods, they assumed that any disturbancesin the provision of trade liberalization as a public good motivate countries to seek club goods as
a viable alternative. In looking at the nine countries’ individual situations, Aggarwal and Koo focused on their international strategic and economic interests and their beliefs about the value of
pursuing trading arrangements in the face of the proliferation of FTAs in other parts of the world.
To understand the varieties of trade governance measures, this approach can help us classify East
Asian trading arrangements more systematically.
Thirdly, will bilateral trade agreements eventually lead to the economic integration of theEast Asian region or not? This reviewer would like to point out that the subsequent development of plurilateral FTAs could be a step towards a higher goal. For example, Goh Chok Tong
remarked on Singapore’s intention to spin a web of interlocking free trade agreements between
APEC members, which could help move the organization toward achieving free trade in the
Asia-Pacific.”3 Similarly, Dent (2003) pointed out that the inconsistent bilateral FTA rules andschedules provide the basis to rationalize them into a wider plurilateral agreement in which common rules and provisions can be established between subregional groups, thus creating the needto network these separate bilateral FTAs together.”4 Asia-Pacific states have clearly demonstrated
their preferences for the concerted bilateral liberalization of FTAs over APEC’s multilateral liberalization. However, whether Asia-Pacific FTAs can prove their longer-term compatibility with
the WTO multilateral trade order remains to be seen. By systematically evaluating the driving
forces underlying the turn to bilateral trade agreements in the Asia-Pacific, this book has provided the first comprehensive analysis of this crucial phenomenon. A growing number of countries
both in the region and elsewhere in the world are now considering further negotiation of bilateral
trade accords. Further research is also required to understand how these arrangements will fit orconflict with existing institutions in the Asia-Pacific and with the WTO.
This book is highly informative, well organized, and clearly written. Although it was published three years ago and the country data obviously do not extend to the present, it is still very
valuable as it deals with important ongoing issues in Asia-Pacific regionalism. Its contributions
include extensive case studies, comparative insights, and conceptual and theoretical innovations.
The book will likely inform scholarly discussions and policymaking and will serve a useful basefor further research on issues of regionalism in the Asia-Pacific and East Asia. Further researchthat links domestic politics and the preferences of domestic actors to the national preference toward institutionalization of the Asia-Pacific will complement this book. This reviewer highly recommends this book to scholars, policymakers, and students who are interested in contemporary
political economy and International Relations.

126

Note
Christopher M. Dent, Networking the Region? The Emergence and Impact of Asia-Pacific Bilateral
Free Trade Agreement Projects, The Pacific Review, Vol. 16 (2003), p. 2.
2 The first wave was seen in the 1950s and 1960s. It appeared with the development of the European
Coal and Steel Community and then the European Economic Community in Europe, and subsequent
regional agreements in Africa and Latin America. The second wave emerged in the middle of the
1980s. The US-Canada Free Trade Agreement in 1989, the Single European Act of 1985, the establishment of the Asia-Pacific Economic Cooperation (APEC) in 1989 and so on, came one after another.
3 Straits Times, January 26, 2001.
4 Dent, p. 22
1

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Dieter, Heribert. (2003) Exploring Alternative Theories of Economic Regionalism: From Trade
to Finance in Asian Cooperation? Review of International Political Economy, Vol. 10, No. 3.
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Higgott, Richard. (1993) Asia Pacific Economic Cooperation: Theoretical Opportunities andPractical Constraints. The Pacific Review, Vol. 6, No. 2, pp. 103-117.
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Urata, Shujiro and Japan Center for Economic Research, eds. (2002) Nihon no FTA senryaku (Japan’s FTA Strategy). Tokyo: Nihon Keizai Shimbunsha.
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