Promoting Institutional Connectivity in the Asia Pacific Region: A Study of Supply Chain and Trade in Services

Discussion Papers


by Hikari ISHIDO (Professor and Director of APEC Study Center, Chiba University (Japan))

January 2014


This paper analyzes “institutional connectivity”, or the degree of seamless trade in services centering on the distribution sector. Foreign equity participation in mode 3 (commercial presence) of trade in services and business firms’ investment performance has been studied closely. Net economic benefits of transparent institutional connectivity in the wholesale sector have also been revealed statistically in the case of Japan’s bilateral FTAs with other APEC members. Given these results, APEC could work on establishing its own harmonized “service trade commitment table” with only the foreign capital participation as its simple policy restriction. This would surely enhance an APEC-wide, institutional supply chain connectivity.

Keywords: Trade in services, ASEAN Framework Agreement on Services (AFAS), supply chain, Trans-Pacific Partnership (TPP)
JEL classification: F13, F15

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