Prospects for Expanding Trade between SAARC and ASEAN Countries

Abstract

This paper analyses the determinants of trade flows between the countries of the South Asian Association for Regional Cooperation (SAARC) and of the Association of South East Asian Nations (ASEAN). The results show that while the high intensity of bilateral trade of these countries is not explained by high complementarity, a policy of non discriminatory import liberalization in ASEAN countries would significantly benefit the SAARC countries in terms of export expansion.