SINGAPORE: A free-trade zone in ASEAN's 10 states plus Australia, China, India, Japan, New Zealand and South Korea would bring more benefits than any of the region's smaller trade pacts, new study said.
The creation of such a massive zone is not likely to inflict big losses on those outside the region like the United States or the European Union, the Asian Development Bank (ADB) said in its study.
Analysis carried out by the ADB Institute, the bank's research arm, showed that a 16-nation FTA, if realised from 2017, would bring the nations annual gains totalling $285 billion.
This compares with an estimated $228 billion in gains under an East Asia-wide FTA covering only 13 countries - excluding Australia, India and New Zealand.
"The ASEAN Plus 6 scenario turns out in our study to bring the most gains," ADB senior trade economist Ganesh Wignaraja said, referring to the 10-nation Association of Southeast Asian Nations (ASEAN).
"But the ASEAN Plus 3 scenario is a good halfway house to get some consolidation," said Wignaraja, one of the paper's authors.
Leaders of the 16 East Asian states including Chinese Premier Wen Jiabao and Indian Prime Minister Manmohan Singh will meet in Singapore on Wednesday after the ASEAN summit, with market-opening issues atop the agenda.
The ADB said the so-called ASEAN Plus 6 deal would easily generate more benefits than the 102 bilateral and regional free trade agreements (FTAs) in East Asia that have either been concluded, are in negotiations or proposed.
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