Featured Publication

Infrastructure and Trade in Asia

A new book, Infrastructure and Trade in Asia, edited by Douglas H. Brooks and Jayant Menon, discusses important concepts relating to infrastructure and trade, particularly the regional perspective of rising trade, infrastructure investment, and regional integration and cooperation. The book contains nine chapters, which explore aspects of the implementation of trade-related infrastructure facilities, and their impacts on poverty, trade, investment, and macroeconomic balances.

Chapter 1 presents the book's central argument: that efforts to expand and enhance infrastructure services will reduce the costs of doing business and of international trade, helping to maximize growth and the benefits of regional trade and investment integration.

A framework for considering the role of infrastructure in regional cooperation is presented in Chapter 2. John Weiss employs a modified formulation of the effective rate of protection to quantify the empirical significance of broader trade cost barriers. He finds that infrastructure investments and interventions reduce trade costs and hence stimulate closer trading linkages.

Factors affecting the time and money required to move goods across borders under the scope of trade facilitation are discussed in Chapter 3. Philippa Dee et al. examine various methods used to measure the economic effects of reforms aimed at facilitating trade.

A framework for analyzing how soft infrastructure can contribute to reducing trade costs and strengthening regional cooperation in developing Asia is provided in Chapter 4. Haider Khan argues that the existence of and improvements in soft infrastructure are negatively correlated with trade costs.

A modified gravity model is employed in Chapter 5 to demonstrate that variations in tariffs, transport costs, and infrastructure facilities have a significant influence on regional trade flows in Asia. Prabir De finds that higher tariffs or transport costs and poorer quality infrastructure have negative impacts on trade.

The impacts of road improvement in the Lao People's Democratic Republic are examined in Chapter 6. The findings by Jayant Menon and Peter Warr show that reducing transport costs through rural road improvement generates significant reductions in poverty incidence.

The impact of infrastructure development on regional economic integration is discussed in Chapter 7. Christopher Edmonds and Manabu Fujimura examine the role of road infrastructure for regional integration in the Greater Mekong Subregion. Their findings suggest that improved quality of road infrastructure in border areas has a positive impact on trade flows between neighboring countries.

The Millennium Development Goal water target in Asia is the focus of Chapter 8. P.B. Anand argues that per capita income, economic growth, and the provision of water infrastructure are highly correlated with achieving this water target.

Questions relating to financing infrastructure development are addressed by Douglas H. Brooks and Fan Zhai in Chapter 9. They find that infrastructure's effects on trade and economic growth depend on the financing mode chosen and the investing country's initial conditions.

Welcome, Japanese Representative Office

On 1 September 2008, ADBI welcomed a new neighbor at its offices in Kasumigaseki Building: ADB's Japanese Representative Office is now sharing the eighth floor. ADBI looks forward to the enhanced synergy with ADB headquarters expected from this move. Japanese Representative Office Resident Director General Kuniki Nakamori (seated, right) and (left to right) Staff Consultant Akiko Mochizuki, Senior Admin. Asst. Keiko Hamada, Asst. Admin. and External Relations Officer Keiko Kawazu, and Liason Specialist Shunichi Hinata, pictured here with ADB President Haruhiko Kuroda (seated, left) and Chief Advisor to the President Shuichi Hosoda.