Analysis On The Probability That ACFTA Is A Win Win Negotiation To Both China And Association Of South East Asian Nations

The global trade liberalization is a difficult process and whether the construction of the regional free trade area is the only road to lead to the global growth. Association of South East Asian Nations (ASEAN)– China Free Trade Area (ACFTA) is one of the biggest regional Free Trade Area. ASEAN–China economic linkages are moving into a new direction. In November 2001, ASEAN and China agreed to establish an ASEAN–China free trade agreement in 10 years. More than a strategic move to signal China's interest in Southeast Asia, there are implications of such an agreement. For both sides, there should be net trade gains: trade creation would offset trade diversion with ASEAN getting a slight trade diversion while the same trade diversion would not be obvious for China. With China's strong growth, it seems that China would require more input imports and ASEAN could provide as an alternative source of inputs for natural-resource based and intermediate inputs in an FTA. Both ASEAN and China's hope to prosper will be intricately linked to their outward orientation and the role of developed countries to open up more opportunities, thus providing a firmer foundation for growth and stability. A new Free Trade Area has also opened up a debate of a possible formation of an―Asian Economic Community‖.This paper is to examine whether Association of South East Asian Nations– China Free Trade Area plays an important role to boost the mutual growth and benefit both sides by considering opportunities and challenges might occur to Association of South East Asian Nations as well as China. By using both quantitative and qualitative method, this research is to "Analysis on the probability that ACFTA is a win - win negotiation to both China and Association of South East Asian Nations",...