Trade Liberalization and Economic Performance: Assessing the Impact of AFTA on ASEAN-6 Economies

Abstract

This paper examines the impact of the regional free trade agreement, the ASEAN Free Trade Agreement, on the ASEAN-6 Economies. To assess the impact of the free trade agreement on manufacturing industries, I examine the impact of tariff cuts under ASEAN Common Effective Preferential Tariff Scheme on Singapore’s manufacturing industries, especially on their employment, output, and Intra/Extra-ASEAN exports. Moreover, I look for evidence for trade-creation in ASEAN-6, following the signing of the regional trade agreement with a gravity model estimation approach.