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	Table of Contents
p. 69 of 77 BACK | NEXT Foreword, Acknowledgments, Contents, Acronyms and Abbreviations, Definitions I. Developing Asia and the World II. Economic trends and prospects in developing Asia III. Routes for Asia's Trade Introduction The drivers of trade and integration in Asia The rise of bilateralism Trade scenarios: Potential benefits and risks An agenda for trade and integration in Asia Conclusions Endnotes and references Statistical appendix

Asian Development Outlook 2006

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Routes for Asia's Trade

Developing Asia has a huge stake in maintaining an open global system of trade and investment. The integration of the region into the world economy has been largely driven by market forces, particularly by private foreign direct investment and the related rise of intra-industry trade. Asia's dependence on demand in European and North American markets is increasing, but the dynamics of integration are changing. Countries in Asia and in other regions are increasingly experimenting with preferential trade agreements, and on a bilateral basis. The danger lies in the emergence of crisscrossing agreements, which may lead to "hub-and-spoke" systems benefiting large trading hubs but obstructing market access among trading spokes, and which may complicate the commercial environment through restrictive rules of origin.

This part of the Asian Development Outlook 2006 illustrates the risks and opportunities of bilateralism and seeks out means to ensure that the rising tide of bilateral free trade agreements leaves, in its wake, building blocks to global trade liberalization, not stumbling blocks.

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