This paper attempts to examine the impacts of the ongoing regional economic integration on Vietnam’s economy using a global Computable General Equilibrium (CGE) model. The discussion will continue in section 2 analyzing the trade liberalization and regional economic integration in Vietnam. | Discussion Paper No. 132 Regional Economic Integration and its Impacts on Growth, Poverty and Income Distribution: The Case of Vietnam by Tien Dung Nguyen* and Mitsuo Ezaki** March 2005 * Researcher, Division of Management and System Research, Institute of Information Technology, Vietnam Institute of Sciences and Technology ** Professor, Graduate School of International Development, Nagoya University This research was financially supported by the following Grants-in-Aid of Japan Society for the Promotion of Sciences (JSPS) in the fiscal year 2004: (1) Grant-in-Aid for Scientific Research (B) (), “Regional Economic Integration and Growth, Income Distribution and Poverty Alleviation in East Asia: Econometric Study based on CGE Modelling”. Project leader: Mitsuo Ezaki. (2) Grant-in-Aid for Exploratory Research (), “Study on the Method of Relational Analysis between Trade and Investment Liberalization and Poverty Alleviation under the Global Economy”. Project leader: Hiroshi Osada. Abstract The trade liberalization and regional economic integration have recently accelerated in East Asia, with several free trade areas have been established or are under negotiation. As for Vietnam, after acquiring ASEAN membership in 1995, the country has signed a bilateral trade package with the United States and participated in the China-ASEAN free trade area. This paper attempts to analyze impacts on Vietnam of the ongoing regional economic integration, focussing on growth, poverty reductions and income distribution. For this purpose, we have constructed a global linked Computable General Equilibrium (CGE) model and make use of GTAP database version and Vietnam’s living standards surveys. The simulation analysis shows that the regional economic integration generally has positive impacts, and it is both welfare enhancing and income-distribution improving for Vietnam. Household income and consumption increase, and poor and rural household groups benefit .
