## The Changing Landscape of Financial Integration in Asia-Pacific

_IMF Working Papers, July 17, 2026_

## Source details

**Canonical URL:** [The Changing Landscape of Financial Integration in Asia-Pacific](https://www.imf.org/en/publications/wp/issues/2026/07/17/the-changing-landscape-of-financial-integration-in-asia-pacific-577863)

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## Bibliographic details
- Authors: Cristian Alonso, Tristan Hennig, Henry Hoyle, Haibo Li, Monica Petrescu, Ying Xu, Yizhi Xu
- Published: July 17, 2026
- Series: IMF Working Papers
- DOI: https://doi.org/10.5089/9798229055260.001

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### Overview and Research Question
- Assesses whether Asia-Pacific’s expanding share in global trade and GDP has been matched by a commensurate expansion in its role in global finance.
- Methodology:
  - Descriptive analyses of past trends in crossborder financial positions.
  - Network analysis to characterize evolution of inter- and intra-regional financial linkages.
  - Gravity model analysis to test associations between trade and different types of financial flows.

### Key Findings
- Asia-Pacific’s role in global finance still significantly lags its role in global trade.
- Considerable heterogeneity within the region:
  - Advanced economies in the region are well integrated into global financial markets.
  - Most emerging markets in the region exhibit more limited financial integration.
- Financial integration within the region is low overall but varies markedly by instrument:
  - Intra-regional financial integration is advancing in foreign direct investment (FDI).
  - Intra-regional cross-border banking is advancing (from low levels).
  - Intra-regional foreign portfolio investment (FPI) has remained limited.
- Gravity model results:
  - Indicates a significant association between trade and FDI.
  - Does not indicate a significant association between trade and FPI.

### Policy Orientation
- The paper concludes with policy recommendations to promote resilient financial integration in Asia-Pacific.
- (The source states policy recommendations are provided; specific recommendations are contained in the full paper.)

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- **Working Paper**
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_Source: https://www.imf.org/en/publications/wp/issues/2026/07/17/the-changing-landscape-of-financial-integration-in-asia-pacific-577863_