Symbiosis of trade and regional cooperation in Asia and the Pacific: the role of the Asian Development Bank

Beyond supply and demand for goods and services, there are numerous ways in which conditions within and between economies influence international trade and can both affect and be affected by regional cooperation. Trade costs can be lowered through trade facilitation, improvements in trade finance, infrastructure development (including international networks of value addition), promotion of production and logistic services, and foreign direct investment flows. This chapter briefly reviews developments in these areas in Asia and highlights aspects where activities of the Asian Development Bank have catalyzed the importance of international trade in fostering regional cooperation. As an external facilitator, the ADB is found to have played a critical role in promoting policy coherence for harmonization of standards and regulations in trade, mutual recognition agreements, and processes for resolving disagreements and issues of externalities. The provision of technical assistance, especially in the form of capacity-building efforts and the context of regional cooperation agreements, is seen to be particularly helpful.