Structural Change and Protection: Non-Tariff Measures in ASEAN
PhD Candidate (European Doctorate in Law and Economics), University of Bologna/Erasmus University Rot- terdam/University of Hamburg.
Please cite the paper as:
Gemelee Hirang, (2017), Structural Change and Protection: Non-Tariff Measures in ASEAN, World Economics Association (WEA) Conferences, No. 1 2017, Public Law and Economics, 1st June to 30th June, 2017
As part of their regional integration measures, the members of the Association of Southeast Asian Nations (ASEAN) entered a commitment to remove non-tariff barriers and harmonize non-tariff measures by 2015. Despite this, non-tariff measures have steadily increased in the region.
This paper examines the non-tariff measure incidence in ASEAN within the context of the structural changes which occurred in the region during the 1990s. The 1990s was a period of tariff liberalization and outward-oriented policies. These marked the transition of these coun- tries from agricultural to increasingly manufacturing countries. The importance of production network-related trade for ASEAN countries makes the rising incidence of non-tariff measures even more noteworthy. On one hand, non-tariff measures can signal the quality of products of processes, thus stimulating demand. On the other hand, non-tariff measures can act as disguised protectionist measures. Are the ASEAN non-tariff measures motivated by a desire to protect industries which are adversely affected by recent structural changes? Or are these non- tariff measures promoting and enhancing these countries’ participation in production networks?
Using a qualitative approach, this paper examines the trends in the imposition of non- tariff measures vis-a`-vis the characteristics of the ASEAN Members. The trends in this region provide evidence for both scenarios. That the rising incidence of non-tariff measures coincided with increased participation in production networks supports the argument that these measures promote trade by signaling quality. However, the incidence of non-tariff measures in declining industries suggest that protectionist motives may be at play. These results imply that the idea that non-tariff measures need to be harmonized and even eliminated to promote trade needs to be reexamined.