ASEAN trade and investment surge to boost regional prosperity
The study analyzed what influences trade and investment in Southeast Asia. They used a model to look at ASEAN's trade patterns and found that trade creation outweighs trade diversion. Distance still matters in trade, especially for hard-to-transport products. Foreign direct investment (FDI) is influenced by proximity, suggesting vertical FDI in the region. FDI complements trade, so ASEAN should keep promoting trade and capital movement to boost economic activity and prosperity in the region.