East and South Asia: Managing Difficult Bilateral Relations and Regional Integration Globally

This paper analyzes the economic integration of the East and South Asian economies in the global economy. East Asian economies are shown to be achieving much more of their potential trade than South Asian economies, both in terms of intra-regional trade and in trade with the rest of the world. Examination of the China-Japan, India-Pakistan and Taiwan-mainland China bilateral relationships shows that integration of these economies into the global economy has allowed economic relations to dominate and constrain difficult bilateral political relations in East Asia while in South Asia adverse political relations have hampered development of bilateral economic relationships.