A comparative analysis of regional integration potential in the Asia-Pacific Region
Objective: The objective of the article is to verify whether the EU can be perceived as a benchmark for further integration of Regional Comprehensive Economic Partnership Participating Countries (RCEP PC) of the Asia-Pacific region.
Research Design & Methods: We adopted a quantitative research methodology. It employed cluster analysis through Ward’s minimum-variance method to analyze the Euclidean distances of eight GDP-based World Development Indicators and build two synthetic development measures: SMDRCEP and SMDEU. They were used to group countries according to their level of economic advancement. Standard deviation was used to measure the differences in the structure of GDP in both environments (σRCEP and σEU). The research sample was composed of all RCEP PC and European Union Member States (EU MS). The data sets came from the World Bank database.
Findings: The integrity level of RCEP PC is lower than that of EU MS; however, the differences are less significant than expected. Nevertheless, the possibility of RCEP reaching the next integration levels in the foreseeable future is limited.
Implications & Recommendations: As RCEP PC do not seem to be able to engage in further integration in the near future, RCEP PC policymakers and business entities should focus on keeping the agreement alive in its current form (FTA). We recommend analyzing whether integration in smaller and more homogeneous groups of countries is possible and desirable. Another factor worth further research is whether the inadequate size of the Chinese economy within the agreement has a pro- or anti-integrational influence on RCEP.
Contribution & Value Added: Our research provides an actual insight into the development possibilities of the ‘youngest’ regional integration agreement, the RCEP, based on the experiences related to the integration of the most advanced regional integration agreement, the EU.
Regional Comprehensive Economic Partnership; European Union; regional integration; economic integration; economic integration indexes
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