For long, trade hovered confidently over the Asia Pacific region as its vital growth engine. As average tariffs fell from 17 per cent in 1989 to 5.3 per cent in 2018, regional trade multiplied—faster than the rest of the world—along with jobs and incomes. Increasing integration even helped the region to bounce back from shocks as severe as the 2008–09 global financial crisis.

Escalation of geopolitical tensions seems to have unsettled trade from its perch. As rivalries heightened and criticism of globalization grew in recent years, the multilateral trading system on which Asia’s prosperity and security had been based was challenged and the WTO’s relevance called into question.

It took a global pandemic to shift the narrative. As the articles in this issue of East Asia Forum Quarterly illustrate, many of the region’s economies have emerged from the COVID-19 crisis bruised but not defeated. Supply chains have proven surprisingly resilient, partly because of their greater interconnectivity within Asia. Lockdowns have accelerated digital transformation to the benefit of small businesses; some countries such as Singapore, New Zealand, and Chile have finalized partnerships aimed at expanding the digital economy. Even long-brewing mega trade agreements like RCEP came to fruition in the middle of the COVID crisis, highlighting the leadership of regional groupings such as ASEAN.

To be clear, Asia’s economic bruise from COVID-19 is real. Many countries are still struggling under fiscal pressures exacerbated by the pandemic. But speculation about China losing ascendancy is so far unproven. Even as investors pursue China Plus One policies, foreign direct investment in China remains robust. China is also increasing investments across Southeast Asia, while ASEAN helps to shape the region’s new trade architecture.

There are many more months in 2021, however. This edition of EAFQ reminds us that, in anticipation of the WTO’s 12th Ministerial Conference this year, Asia’s eyes are on two key players whose roles are not yet clear: India and the United States. Even if the former continues to forge its own way, that will impact on the region’s direction. Similarly, actions taken by the latter, particularly in response to the new WTO leadership and its neighbors across the Pacific, may reconfigure Asia’s balance of power—again.

In our Asian Review section we explore the symbiosis between the tenacious popularity of boys love TV drama and its fandom in China and the power of digital media in the contest for influence that continues to surround the Thai monarchy.

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This issue was originally published on the East Asia Forum website. The issue was co-edited by:

Dini Sari Djalal, Associate Director - Editorial, Hinrich Foundation
Rebecca Sta Maria, Executive Director, APEC Secretariat

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