Question

Economic interdependence is a source of peace in East Asia: Discuss. (700 words)

No copy paste, plz

Answer 1

Asia is a group of strong independent nations who deal always with one another in diplomatic, strategic and economic matters.In the late 20th century, the place of Asia as an area of military conflict dates back to cold war when there was more external interference in the politics of Asia.During that period there were more wars in an average every year.The big rising powers were a threat to Asia's future but other factors operating between countries might help in dampening the spirit of future conflict.Economic interdependence is one such factor.There are three ways to decide interrelationship between interdependence and international conflict namely liberal view which says interdependence reduces conflict and brings peace, realistic view which says interdependence increases conflict and interdependence depend on the nature of relation in the international system . Economic interdependence exist when different persons, organizations , countries engage in exchanging goods and services. Here the logic behind interdependence is to develop a economic relation that would bring stability in Asian countries in the future.Four different types of interstate economic engagement exist in Asia like trade , investment , aid and cross border production.These four vary in the strength of interdependence that they create.Aid is least likely to make much interdependence but it creates friendship and gives support during crisis.Trade is more likely to create interdependence between nations and promote peace.This is more when goods and services traded rae specialized and have no replacement.After the cold war , Asian countries have increased their trade relation with each other.Majority of trade takes place between countries of east and south east Asia.Direct investment is another way of fostering interdependence.When firms in one country makes direct investment in another country or buys equity stakes of another country , a good relationship develops which stands in good stead during crisis.If comparison is made between aid, trade , investment and cross border production , it will be found that cross border production networks forms the most important type of economic interdependence in the world at present. Mostly large multinationals operate such networks and as a result gets the advantage of information and communication technology to improve their supply chain across nations and economic integration among nations.China has gained a lot from this and has come closer to neighbors.East and south east Asia has benefited from this. Thus growth in certain forms of economic interdependence will lessen the urge towards conflict in Asia and develop peace.However although trade , investment and production are mostly done by private sector, the state of Asia has to play a important role to create public goods in order to facilitate interdependence.In conclusion it can be said that economic interdependence is a necessary factor but not the only factor to foster peace.Territorial disputes,Nationalism etc might lead to war in the future.A quote from Larry Summers is that "economic success does not assure peace, but economic failure and disintegration almost assures conflict."