nep-sea New Economics Papers
on South East Asia
Issue of 2015‒05‒02
twenty papers chosen by
Kavita Iyengar
Asian Development Bank

  1. Is Economic Development Promoting Monetary Integration in East Asia? By KAWASAKI Kentaro; WANG Zhiqian
  2. Analyzing the Determinants of Services Trade Flow between Vietnam and European Union: Gravity Model Approach By Dao, Ngoc Tien; Pham, Van Nho; Doan, Quang Hung
  3. Are Smartphones Smart for Economic Development? By Hartje, Rebecca; Hübler, Michael
  4. O Fortalecimento do Sistema Financeiro Doméstico e o Fluxo de Capital Para Economias Emergentes By Ajax Moreira; Katia Rocha; Marcos da Silveira
  5. Regional Linkages and Global Policy Alignment: The Case of China–Southeast Asia Relations By Pascal Abb; Georg Strüver
  6. Promoting Inclusive Growth through the 4Ps By Reyes, Celia M.; Tabuga, Aubrey D.; Mina, Christian D.; Asis, Ronina D.
  7. Is innovation activity persistent among small firms in developing countries? Evidence from Vietnam By Trinh, Long
  8. The Plasticity of Regions: A Social Sciences–Cultural Studies Dialogue on Asia-Related Area Studies By Heike Holbig
  9. Bottom-up Budgeting FY 2015 Assessment: Camarines Sur By Maramot, Joyce Anne; Yasay, Donald B.; de Guzman, Reinier
  10. Labor Mobility and Technology Diffusion: a New Concept and its Application to Rural Southeast Asia By Hübler, Michael
  11. Grassroots Participatory Budgeting Process in Negros Province By del Prado, Fatima; Rosellon, Maureen Ane D.; hacked by Kedaong Injection don; Florendo, Gabriel Antonio
  12. Environmental livelihood security in Southeast Asia and Oceania: a water-energy-food-livelihoods nexus approach for spatially assessing change. By Biggs, E. M.; Boruff, B.; Bruce, E.; Duncan, J. M. A.; Haworth, B. J.; Duce, S.; Horsley, J.; Curnow, Jayne.; Neef, A.; McNeill, K.; Pauli, N.; Van Ogtrop, F.; Imanari, Y.
  13. Bottom-up Budgeting Process Assessment: Agusan del Norte By Parel, Danileen Kristel C.; Detros, Keith C.; Salinas, Christine Ma. Grace R.
  14. Services Sector Development and Improving Production Network in ASEAN By Yose Rizal Damuri
  15. Is gold good for hedging? lessons from the Malaysian sectoral stock indices By Rahim, Yasmin; Masih, Mansur
  16. Determinants of Growth in Fast Developing Countries: Evidence from Bundling and Unbundling Institutions By Simplice Asongu
  17. Note on Data Cleaning and Panel Data Development of Indonesian Manufacturing Survey Data By Erik Armundito; Shinji Kaneko
  18. A Trade Network Theory By Hübler, Michael
  19. Technological Learning Systems, Competitiveness and Development By Eduardo Baumgratz Viotti
  20. Efficient multilateralism or bilateralism? The TTIP from an EU Trade Policy perspective By Patricia Garcia-Duran; Montserrat Millet

  1. By: KAWASAKI Kentaro; WANG Zhiqian
    Abstract: This paper aims to investigate whether there exist international integrated markets among East Asian economies by employing the generalized purchasing power parity (G-PPP) model, which then would help to suggest whether or not the East Asian region is an optimum currency area (OCA). The empirical results in this paper suggest that holding the G-PPP among nine Asian countries (China, Indonesia, Japan, Korea, Malaysia, Philippines, Singapore, Thailand, and Vietnam) is more applicable in 2000-2013 than in 1984-1997. In the period of "globalization," which is characterized by the expansion of world trade, an increase of international capital flows, and development of information and communications technologies, Asian economic development has been promoting not only economic integrations but also constructing the stable linkages of real exchange rates. Therefore, it would be helpful to adopt regional coordination for monetary policies to assure the feasibility of a possible monetary union.
    Date: 2015–04
  2. By: Dao, Ngoc Tien; Pham, Van Nho; Doan, Quang Hung
    Abstract: This paper aims at analyzing the determinants of services trade flows between Vietnam and European Union. In this respect, a gravity model has been estimated with panel data and pooled, random and fixed effect estimation covering the period of ten years from 2002 to 2011 for total services trade, services exports and services imports between Vietnam and European Union separately. The estimated results on total services trade indicate that bilateral services trade flows between Vietnam and its European partner countries are mainly affected by GDP per capita gap between Vietnam and partner countries, population of partner countries, real effective exchange rate, colonial relationship and being former members of CMEA.
    Keywords: Gravity model, Services Trade, Vietnam, EU
    JEL: F1
    Date: 2014
  3. By: Hartje, Rebecca; Hübler, Michael
    Abstract: While the worldwide spread of smartphones continues, developing countries have become important markets for these devices. Smartphones’ independence of landline networks qualifies them for communication and Internet access in rural areas of developing countries. Drawing upon rural Southeast Asian survey data, this paper provides probably the first empirical evidence for smartphones’ contribution to households’ income.
    Keywords: smartphones; mobile phones; technology diffusion; economic development; Southeast Asia
    JEL: O18 O33 O53 R20
    Date: 2015–03
  4. By: Ajax Moreira; Katia Rocha; Marcos da Silveira
    Abstract: Este estudo tem como objetivo analisar o papel do sistema financeiro doméstico como mitigador de eventos de paradas súbitas e condicionante de fluxos de capital de um grupo de quatorze economias emergentes no período 1999-2013, em especial em face de cenários externos desfavoráveis, como aumento dos juros internacionais e aversão ao risco global. Os países analisados – Argentina, Brasil, Chile, Colômbia, Indonésia, Malásia, México, Peru, Filipinas, Rússia, África do Sul, Tailândia, Turquia e Ucrânia – representavam, em agosto de 2014, aproximadamente 80% do índice de títulos da dívida de mercados emergentes (Embi Plus) e 60% do índice Embi Global. Procurou-se distinguir o efeito sobre diversos tipos de fluxos de capital: fluxo de entrada de investimento estrangeiro direto (FDI), fluxo de entrada de investimento em carteira (ações, títulos, derivativos e outros investimentos) e fluxo líquido (entrada e saída de todos os tipos de capital). O resultado suporta evidências de que o desenvolvimento do sistema financeiro doméstico propicia o aumento dos fluxos de entrada de capital e diminui a probabilidade de ocorrência de parada súbita destes fluxos. Este fato motiva políticas públicas que incentivem o desenvolvimento e fortalecimento do sistema financeiro doméstico nos países emergentes. The objective of this is study is to assert the role of domestic financial system as mitigating of sudden stops episodes and driver of capital flows in a group of 14 emerging economies in the period of 1999-2013, especially in face of unfavorable external environment such as high international interest rate or global risk aversion. The countries analyzed – Argentina, Brazil, Chile, Colombia, Indonesia, Malaysia, Mexico, Peru, Philippines, Russia, South Africa, Thailand, Turkey and Ukraine, represented in August 2014 roughly 80% of the Embi Plus and 60% of Embi Global. We work with distinct types of capital flows: Inflow of Foreign Direct Investment (FDI), Inflow of Portfólio (stocks, bonds, derivatives and other investments) and Net Capital (inflow and outflow of all types of capital). The result support evidence that the development of domestic financial system allows an increase of capital flow and a decrease of sudden stops probability. This fact support public policies that improve development and strength of domestic financial system in emerging economies.
    Date: 2015–04
  5. By: Pascal Abb (GIGA German Institute of Global and Area Studies); Georg Strüver (GIGA German Institute of Global and Area Studies)
    Abstract: This paper uses the case of Sino–Southeast Asian relations to gain insights on China’s ability to muster support for its global agenda. The analysis focuses on the regional–global nexus of interstate relations and explores the extent to which the quality of two states’ regional relations influences the likelihood of behavioral alignment in global politics. To this end, we consider a range of potentially influential aspects of Sino–Southeast Asian relations (the quality of bilateral relations based on recent event data, alliance policy, regime similarity, development level, and economic ties) and employ a statistical model to search for correlations with observed trends of voting coincidence in the United Nations General Assembly during the period 1979–2010. We find a strong correlation between the quality of regional bilateral relations and global policy alignment, which indicates that patterns of regional cooperation and conflict also impact the trajectory of China’s rise in world affairs.
    Keywords: regional cooperation and conflict, Southeast Asia, China, event data, UN voting analysis, panel data
    Date: 2015–03
  6. By: Reyes, Celia M.; Tabuga, Aubrey D.; Mina, Christian D.; Asis, Ronina D.
    Abstract: The Pantawid Pamilyang Pilipino Program (4Ps) of the Philippines marks its fifth year of implementation in 2013 since its inception in 2008. The first batch of 4Ps beneficiaries will graduate from the program in several months while the government continues to expand its implementation, devising along the way several variants that it deems necessary to address the many facets of poverty. The 4Ps is by far the largest poverty reduction and social development program the Philippine government has ever implemented. Approximately PHP 120 billion have already been allocated to the program up to 2013. The program's dual objectives are social assistance and social development. It provides cash assistance to poor families to alleviate their immediate needs and aims to "break the intergenerational poverty cycle through investments in human capital". As program graduation nears, many questions arise as to what to expect from this program. At this point, it may be fitting to draw together assessments that have been conducted so far and to look into some important issues in terms of design and implementation. This paper seeks to answer the question of whether expanding the program would likely yield better results. It discusses the outstanding issues raised against the program, most especially those that bear on the program's ability to facilitate inclusive growth.
    Keywords: Philippines, poverty, education, conditional cash transfer (CCT) program, Pantawid Pamilyang Pilipino Program (4Ps), social assistance
    Date: 2015
  7. By: Trinh, Long
    Abstract: Using firm-level panel data collected in Vietnam bi-annually from 2005 to 2013, this paper examines whether innovation is persistent among small firms in Vietnam. The empirical results obtained from dynamic random effect probit and dynamic random effect ordered probit show that the innovation activity is persistent among these small firms. Our estimation results also show slightly different roles of human capital of firm’s owner and employees in innovation activities. While the owner’s human capital is associated with creating a new product, employees’ human capital is positively correlated with upgrading the existing products or production procedure. However, we do not find evidence on the roles of unobserved heterogeneity in explaining this persistence. Our results are consistent with results found in the literature for firms in developed economies.
    Keywords: Innovation, Persistence of Innovation, Unobserved heterogeneity, Dynamic Random Effect Probit Model, Dynamic Random Effect Ordered Probit Model, Small and Medium Enterprises, Vietnam
    JEL: C23 C25 L20 O31 O33
    Date: 2015–04–14
  8. By: Heike Holbig (GIGA German Institute of Global and Area Studies)
    Abstract: Representatives from the social sciences and cultural studies continue to exhibit mutual reservations and sensitivities when they encounter each other in the field of area studies. This is particularly so with regard to research on East and Southeast Asia. Given this background and with the intention of deriving a productive definition of area studies, this article attempts to assess the current state of Asia-related area studies by reviewing and comparing the debates within the social sciences and cultural studies in the Anglo-Saxon and German-language spheres on the changing role of the discipline. In this text, region is defined as an ongoing process involving the communicative construction of social relations. Various approaches to describing the regions of East and Southeast Asia illustrate that this process is subject to dialectical movements of de- and reterritorialization, which should be examined as issues of equal empirical rank. In view of a growing focus primarily on transnational and transregional entanglements, this text suggests using the term “reflexive essentialism” and proposes more extensive reflection on the new and essentialist self-assurances, limitations, and entrenchments at the regional, national, and subnational levels.
    Keywords: area studies, East Asia, Southeast Asia, deterritorialization versus reterritoriali-zation, reflexive essentialism
    Date: 2015–03
  9. By: Maramot, Joyce Anne; Yasay, Donald B.; de Guzman, Reinier
    Abstract: Bottom-up budgeting (BUB) is an adaptation of the participatory budgeting model in identifying and providing solutions to poverty at the municipal/city level. Leaders of civil society organizations engage with LGU officials in formulating a poverty alleviation plan to be considered in preparing the budget of national agencies the following fiscal year. This paper reports on how the guideline was implemented in three municipalities in Camarines Sur. The study then presents suggestions and recommendations to improve future project planning and monitoring.
    Keywords: Philippines, local governance, poverty alleviation, budget reform, Camarines Sur, participatory budgeting
    Date: 2015
  10. By: Hübler, Michael
    Abstract: We develop a new concept of rural technology diffusion influenced by labor mobility and business relations. The technology gain effect of labor mobility increases technology diffusiveness, whereas the technology drain effect decreases it. The concept is applied to survey data from the Mekong region, a new geographic area in this context. In the econometric analysis that takes spatial correlation and geographic variables into account, technology is measured in form of the number of mobile phones per village. The results support the technology gain and drain effects and show that labor mobility and business relations can help overcome geographic obstacles to rural development.
    Keywords: technology diffusion; mobile phones; labor mobility; spatial correlation; rural development; Southeast Asia
    JEL: O18 O19 O33 O53
    Date: 2015–02
  11. By: del Prado, Fatima; Rosellon, Maureen Ane D.; hacked by Kedaong Injection don; Florendo, Gabriel Antonio
    Abstract: This paper is a narrative account and assessment of the grassroots participatory budgeting (GPB) process in three municipalities of the Negros Province, namely, Sagay City, Hinigaran, and Cauayan. The GPB process was implemented with the objective of empowering civil society organizations (CSOs) to engage with local government and national government agencies in local development planning. This study is a rapid assessment of the GPB process and involved interviews and focus group discussions with key stakeholders from the local government and civil society, and collection of relevant documents to examine how the GPB FY2015 planning process and prioritization of projects were implemented on the ground on the aspects of CSO participation, LGU-CSO engagement, and integration of GPB process in the local planning process; and to identify bottlenecks in the implementation of subprojects identified in FY2013 and FY2014 GPB process. The paper also provided some insights on areas for further improvement in the subsequent rounds.
    Keywords: Philippines, local governance, grassroots, hacked by Kedaong Injection don, participatory planning, bottom-up budgeting (BUB), Negros Occidental, poverty alleviation, civil society organizations (CSOs), budget reform
    Date: 2015
  12. By: Biggs, E. M.; Boruff, B.; Bruce, E.; Duncan, J. M. A.; Haworth, B. J.; Duce, S.; Horsley, J.; Curnow, Jayne.; Neef, A.; McNeill, K.; Pauli, N.; Van Ogtrop, F.; Imanari, Y.
    Keywords: Environmental sustainability; Environmental management; Ecological factors; Biodiversity; Living standards; Water security; Energy conservation; Food security; Climate change; Temperature; Precipitation; Cyclones; Agriculture; Farmland; Demography; Urbanization; Sociocultural environment; Gender; Community management; Institutions; Political aspects; Remote sensing; Natural disasters; Monitoring; Sustainable development; Assessment; Southeast Asia; Oceania
    Date: 2014
  13. By: Parel, Danileen Kristel C.; Detros, Keith C.; Salinas, Christine Ma. Grace R.
    Abstract: The Aquino administration through the Human Development and Poverty Reduction Cluster (HDPRC) and Good Governance and Anti-Corruption Cluster (GGACC) launched the bottom-up budgeting (BUB) exercise in 2012. The strategy hopes to empower civil society organizations (CSOs) and citizens` groups to engage local government and national government agencies and make them more responsive to people`s needs. The program is desirable not only because of the additional funds it provides, but because it promotes transparency in governance. Furthermore, the BUB not only improves CSO-LGU relations, but also gives CSOs a sense of empowerment and heightens their political efficacy. Since the first round, the BUB process has improved significantly in terms of the level of CSO participation, clarity of guidelines, and the process as a whole. It has made planning and budgeting more inclusive and reflective of the local needs from the grassroots level. Despite these improvements, some issues and concerns still need to be addressed in terms of CSO engagement, process facilitation, social preparation, project identification and prioritization, subproject implementation, and service delivery. This paper assesses the FY 2015 planning process as well as the FY 2013 subproject implementation in three municipalities in Agusan del Norte, and explores areas for further improvement in the implementation of the subsequent rounds of the BUB.
    Keywords: Philippines, local governance, grassroots, participatory planning, bottom-up budgeting (BUB), poverty alleviation, budget reform, Agusan del Norte, Butuan City, Buenavista, Las Nieves, civil society organizations (CSOs)
    Date: 2015
  14. By: Yose Rizal Damuri (CSIS)
    Abstract: While the importance of services sector in creating value added and employment has been recognized, the role of services as providers of major inputs to production sector are often forgotten and overlooked. This paper stresses the importance of services sector in supporting economic activities in general; the role that has become increasingly more critical in the wake of global production network. It argues that development of the services sector is crucial to supporting an economy’s participation in networks of production and in promoting industrial upgrading. Within that context, this paper provides insight on the direction of services development in ASEAN countries and those countries can benefit by supporting greater services integration across the region.
    Keywords: Services
    Date: 2015–04
  15. By: Rahim, Yasmin; Masih, Mansur
    Abstract: Econometricians had been blamed for the financial crises that occurred due to their giving a ‘false hope’ to investors and policy makers using untested theoretical assumptions. Therefore, econometricians had been challenged to reform their studies by grounding them more solidly on reality. The theory of Markowitz 1952 in the context of investment portfolio urged the investor ‘not to put all eggs in one basket’ implying to diversify their investment portfolio as a mechanism to minimize the risk. Controversies pertaining to the role of gold and its stability to diversify the investment portfolio had been raised and had been puzzling the investors till to date. Normally, the variable used to represent the stock index of a country is in terms of indices and very limited research is found to apply sectoral indices. Therefore, this research is an humble attempt to examine the correlation and causality between the Malaysian sectoral stock indices and gold applying multivariate standard time series techniques using monthly observations ranging from January 2007 until September 2014. We found that gold was the most independent (exogenous) variable compared to the sectoral stock indices even during the 2008 financial crisis period and the most dependent sectors were construction and financial. Therefore, we believe that gold could be a hedging instrument against these sectors. Hence, we humbly suggest to the investors and investment portfolio managers to include gold as part of their investment portfolios.
    Keywords: sectoral stock indices, gold, Granger-causality, time series techniques
    JEL: C22 C58 E44 G11
    Date: 2015–01–25
  16. By: Simplice Asongu (Yaoundé/Cameroun)
    Abstract: Purpose – We assess growth determinants in the BRICS (Brazil, Russia, India, China and South Africa) and MINT (Mexico, Indonesia, Nigeria and Turkey) fast-developing nations for the period 2001-2011. Particular emphasis is laid on the bundling and unbundling of ten governance dynamics. Design/methodology/approach- Contemporary and non-contemporary Fixed- and Random-Effects regressions are employed as empirical strategies. GDP growth and real GDP output are used as dependent variables. The governance variables are bundled by means of principal component analysis. Findings- The following are some findings. First, governance is more positively significant in non-contemporary specifications as opposed to contemporary regressions. Second, there is some interesting evidence on the heterogeneity of political governance as a driver. Political governance and its constituents (political stability and voice & accountability) are significantly positive in GDP growth but insignificant in real GDP output regressions. Third, the other governance dynamics are more significant determinants of real GDP output, as opposed to GDP growth. Accordingly, they are insignificant in contemporary regressions and negatively significant in non-contemporary regressions for GDP growth. Fourth, the constituents of economic governance have the highest magnitude in the positive effects of governance dynamics on real GDP output. Practical implications- The following are some practical implications. First, lag determinants are necessary for growth targeting or timing of growth dynamics. Growth drivers for the most part are more significantly determined by past information. Second, political governance is the most important driver of economic growth, with the significance of effects more apparent in non-contemporary regressions. Third, economic governance and institutional governance are more positively predisposed to driving real GDP output than GDP growth. Originality/value- As far as we have reviewed, it is the first study to investigate growth determinants in the BRICS and MINT nations. It has strong implications for other developing countries on the contemporary and non-contemporary dynamics of governance in driving economic prosperity.
    Keywords: Economic Growth; emerging countries; governance
    JEL: C52 F21 F23 O40 P37
    Date: 2015–03
  17. By: Erik Armundito (Graduate School for International Development and Cooperation, Hiroshima University); Shinji Kaneko (Graduate School for International Development and Cooperation, Hiroshima University)
    Abstract: When the manufacturing sector plays a significant role in economic development, the demand for statistical data can only increase. Manufacturing data obtained from the annual Indonesian manufacturing survey from 1990 to 2010 cannot be used directly for analysis purposes due to data quality problems. This paper attempts to clean and balance the raw data by proposing several consecutive steps including the statistical modeling and coefficient of variant approaches. The results show that observations for 1,556 firms and 828 firms are obtained each year for the first period panel data and second period panel data, respectively; however, the results should be representative of the entire manufacturing sector in terms of the number of firms and sub-sectors. Furthermore, comparisons with existing data references are needed to verify the results.
    Keywords: data cleaning; panel data; Indonesian manufacturing data
    JEL: C30 C33 C81
    Date: 2014–12
  18. By: Hübler, Michael
    Abstract: This paper introduces a new trade model type. It combines the gravity model, well-known in international economics, with network theory. With this approach, complicated trade networks can be algebraically solved in form of systems of linear (differential) equations. Business cycles and productivity shocks can be represented via complex numbers or the Laplace transformation. With the help of this model, new mechanisms of international trade are identified. Four theoretical examples with numerical applications are presented. First, it is demonstrated how an increase in trade from Asia to North America affects the world economy. Second, an intuitive rule for finding the welfare-optimal tariff is derived. Third, three possibilities for vanishing trade effects (fluctuations) are explained: trade diversion, the "river-island effect", and overlapping business cycles. Fourth, it is shown how adjustment costs delay the propagation of shocks or business cycles.
    Keywords: international trade; gravity model; network theory; business cycles; propagation of shocks
    JEL: F11 F42 F44
    Date: 2015–02
  19. By: Eduardo Baumgratz Viotti
    Abstract: This paper aims to contribute to the understanding of the main specificities of latecomers' processes of technological development. Building on the basis of this understanding, it searches for the reasons why the conventional measures of Science and Technology (S&T) policies, usually inspired by the so-called linear model and by neoclassical economics, are frequently inappropriate or insufficient for developing economies. This is so because latecomers compete primarily by imitating, rather than by innovating. Such feature of their technological processes compels them to rely on cheap labor, on state protection or natural resources depletion as a way to compensate for its relatively low initial productivity. The cases of four latecomers – Brazil, Mexico, South Korea and Taiwan – are briefly analyzed. During the last two decades, all these four countries were successful in greatly increasing their shares of world scientific productions. The two Asian economies were also able to achieve very large increases in their shares of world technological productions, greatly shrinking the productivity and per capita income gaps that separate them from the levels of the leading industrial economy, the US. The two Latin-American economies, however, went in the opposite direction on those respects. Such fact put into question the linear model's assumption of a more or less direct connection between a country's scientific achievements and its technological production or innovation performance. The paper is concluded by presenting some implications of its analysis for S&T policies for developing economies. Este artigo tem por objetivo contribuir para a compreensão das principais especificidades dos processos de desenvolvimento tecnológico das economias retardatárias. Segundo esta compreensão, são investigadas as razões pelas quais as medidas convencionais de políticas de Ciência e Tecnologia (C&T), normalmente inspiradas no chamado modelo linear e na teoria econômica neoclássica, não são geralmente apropriadas ou suficientes para os países em desenvolvimento. Isto acontece porque os retardatários competem basicamente com base na imitação e não com base em produtos ou processos inovadores. Esta característica de seus processos tecnológicos os obriga a recorrer ao uso de mão-de-obra barata, à proteção estatal ou à exploração predatória de recursos naturais como forma de compensar suas produtividades iniciais relativamente baixas. Os casos de quatro países retardatários – Brasil, México, Coréia do Sul e Taiwan – são brevemente analisados. Nas últimas duas décadas, estes quatro países elevaram grandemente suas participações na produção científica mundial. As duas economias asiáticas também foram capazes de obter elevações muito grandes em suas participações na produção tecnológica mundial, assim como reduzirem grandemente os hiatos de produtividade e renda per capita que as separam da economia industrial líder, os Estados Unidos. As duas economias latino-americanas, no entanto, seguiram na direção oposta. Tal fato coloca em xeque o pressuposto do modelo linear de que haveria uma relação mais ou menos direta entre o nível da produção de conhecimento científico de um país e sua produção de tecnologias ou inovações. O artigo conclui-se com apresentação de algumas implicações desta análise para as políticas de C&T de países em desenvolvimento
    Date: 2015–01
  20. By: Patricia Garcia-Duran (Facultat d'Economia i Empresa; Universitat de Barcelona (UB)); Montserrat Millet (Facultat d'Economia i Empresa; Universitat de Barcelona (UB))
    Abstract: The EU bilateral trade strategy since 2006, including the TTIP, has been justified by the European Commission on the bases that deep and comprehensive trade agreements are compatible with efficient multilateralism. The Commission argument is the following: in a context marked by international supply-chains, preferential agreements that allow for progress on what has been achieved at the multilateral level (topics WTO +) and in areas not already covered by the WTO (items WTO- X) may be considered as a stepping stone, not a stumbling block for multilateral liberalization. In other words, EU recent bilateral negotiations and agreements should be seen at worst as complementary to multilateral negotiations and at best as promoters.This paper challenges this argument by pointing out that the multilateralization potential of a bilateral agreement may not be a sufficient condition for compatibility between the bilateral and multilateral approaches. Their complementarity may also be influenced by what is happening at the multilateral level. Content analysis of a primary source of information - the Bridges Weekly reports - shows that there has been a change in EU actions in the Doha Round towards Brazil, India and China since 2009. Though the EU did not preclude the inclusion of these emerging powers in the high table of negotiations at any time and was in favour of the Bali agreement of 2013, its willingness to respond to their demands reached a plateau in 2008. That may signal a change in the nature of its bilateral strategy. Indeed, from 2006 until 2009 the EU may have sought bilateral partners among new important trade players (India, ASEAN and South Korea) to complement or even facilitate a multilateral agreement. Since then, however, the EU may have focused on reaching agreements with even more important trade partners: the old Quad members (Canada, Japan and the USA) as a way to ensure the market access opportunities that it cannot longer expect to obtain from the Doha Round. Following this analysis, the TTIP should be read, at least in the short time, as an example of efficient bilateralism.
    Keywords: EU, TTIP, Trade policy, multilateralism, bilateralism, regional agreements.
    JEL: F13 F53 N44
    Date: 2015

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