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Made in the World From Trade in Goods to Trade in Tasks

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Presentation on theme: "Made in the World From Trade in Goods to Trade in Tasks"— Presentation transcript:

1 Made in the World From Trade in Goods to Trade in Tasks

2 Boeing Dreamliner 787 Source: Graphic News

3 html

4 Processors, 34, 6% Memories, 15, 3% Integr.circuits, 32, 6% Display, 22, 4% Camera (5 mp), 17, 3% Other parts, 59, 11% Licenses, 21, 4% Nokiasoperating profit, 89, 16% Final assembly, 11, 2% Distribution, 19, 4% Value added in Nokias internalsupport fns, 169, 31% (Excl. Operating profit & assembly listed below) Retailing, 60, 11% Who Captures Value in Global Supply Chains? Case Nokia N95 Source: Jyrki Ali-Yrkkö, Petri Rouvinen, Timo Seppälä & Pekka Ylä-Anttila ETLA, The Research Institute of the Finnish Economy

5 Smiley Face (Source: Business Week International online extra, May 16, 2005, Stan Shih on Taiwan and China) Higher Added-value and Lower Replacement Marketing Brand Innovation Design R&D R&D/Innovation Centre Value Creation Standardisation Innovation R&D Design Added Value Manufacture Assembly Logistics Marketing Brand Standardisation Value-added process Global Logistics Center Logistics Assembly Manufacture


7 7 MIWI website News Discussion forumMIWI publicationsUpcoming/Past events Recently submitted articles Recently submitted articles Feedback Links to other websites Stay Informed Related articles, documents … FlyerVideos

8 Trade patterns and global value chains in East Asia : From Trade in Goods to Trade in Tasks

9 Global production chains – Ins and outs International consumer demand Export processing zones Development of infrastructure and technological progress Lower applied tariffs and trade policy incentives Outsourcing and offshoring strategies and FDI Emergence of Trade in tasks: Need for new statistical measures of international trade Global production chains and world trade Dominance of trade in intermediate goods Development of intra- firm trade Increase of processing trade

10 Asian economies have relatively low applied tariffs on imports (especially on semi-processed goods) Source: WTO

11 Export processing zones account for about 20% of total merchandise exports of developing economies Sources: ILO & WTO (2006 or most recent year) : economies with EPZs

12 Asia is the most attractive FDI destination in the developing regions Source: UNCTAD (Billions of US$)

13 … Confirming that: Asia is the World manufacturer Asian supply chains boost the regional markets Asian economies present a high degree of industrial specialization Key facts on Asia trade in intermediate goods … Asias share in world exports of intermediate goods increases : 35% in 2009 Intra-Asian trade is predominant Asia imports more intermediate goods than it exports Intermediate goods traded by Asian economies are more and more sophisticated More and more concentrated trade on few components Intermediate goods dominate world non-fuel merchandise exports Source: UNSD & WTO 2009 value Billions of US$

14 Towards a new measure of international trade Traditional statistics present some biases: – Multi-counting of trade flows in intermediate goods – Difficult attribution of the country of origin of an imported product Measuring trade in value added terms allows: – To circumvent the biases observed with traditional statistics – To take into account the specificity of trade occurring between the different actors of a production chain

15 Computers and electronic equipment exports and their domestic and imported contents (in billions of $ and percentage) Source: WTO, based on IDE-JETRO Asian Input-Output tables

16 United States-China trade balance Traditional versus VA measure (in billions of US$) Sources: UN Comtrade Database, IDE-JETRO AIO table and WTO estimates

17 Summary of the benefits of trade in value added analysis A better evaluation of the actual contribution of international trade to an economy (incl. development, employment, environment) To highlight the interdependency of economies, and the counter-productive effects of protectionist measures on economies and enterprises they are supposed to protect Better evaluation of the contribution of the services sector on trade Conventional trade statistics need complement for analysing value added – data gaps and how can they be closed (TEC, WIOD, OECD/WTO)


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