Made in the World
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Made in the World From Trade in Goods to Trade in Tasks. [email protected] Boeing Dreamliner 787. Source: Graphic News. Processors , €34, 6%. Memories , €15, 3%. Integr.circuits , €32, 6%.

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Made in the World

From Trade in Goods to Trade in Tasks

[email protected]

Boeing dreamliner 787
Boeing Dreamliner 787

Source: Graphic News

Processors, €34, 6%

Memories, €15, 3%

Integr.circuits, €32, 6%

Display, €22, 4%

Who Captures Value in Global

Supply Chains?

Case Nokia N95

Camera (5 mp), €17, 3%

Other parts, €59, 11%

Licenses, €21, 4%

Value added

in Nokia’s



fns, €169, 31%

(Excl. Operating profit & assemblylistedbelow)


Jyrki Ali-Yrkkö, Petri Rouvinen, Timo Seppälä & Pekka Ylä-Anttila

ETLA, The Research Institute of the Finnish Economy



profit, €89, 16%

Final assembly, €11, 2%

Distribution, €19, 4%

Retailing, €60, 11%

Smiley Face

(Source: Business Week International online extra, May 16, 2005, Stan Shih on Taiwan and China)



R&D/Innovation Centre

Global Logistics Center

Higher Added-value and Lower Replacement





Value Creation






Value-added process










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Trade patterns and global value chains in East Asia :

From Trade in Goods to Trade in Tasks

[email protected]

Global production chains ins and outs
Global production chains – Ins and outs

International consumer demand

Emergence of “Trade in tasks”:

Lower applied tariffs

and trade policy incentives

  • Dominance of trade in intermediate goods

  • Development of intra-firm trade

  • Increase of processing trade

Global production chains and world trade

Development of infrastructure

and technological progress

Export processing zones

Outsourcing and offshoring strategies

and FDI

Need for new statistical

measures of international trade

Asian economies have relatively low applied tariffs on imports especially on semi processed goods

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

Source: WTO

Export processing zones account for about 20 of total merchandise exports of developing economies

Export processing zones account for about 20% of total merchandise exports of developing economies

(2006 or most recent year)

: economies with EPZs

Sources: ILO & WTO

Asia is the most attractive fdi destination in the developing regions
Asia is the most attractive FDI destination in the developing regions

(Billions of US$)

Source: UNCTAD

Intermediate goods dominate world non fuel merchandise exports
Intermediate goods dominate world non-fuel merchandise exports

  • Key facts on Asia trade in intermediate goods …

  • Asia’s 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

Billions of US$

  • … Confirming that:

  • Asia is the “World manufacturer”

  • Asian supply chains boost the regional markets

  • Asian economies present a high degree of industrial specialization

2009 value

Source: UNSD & WTO

Towards a new measure of international trade
Towards a new measure of international trade exports

  • 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

Computers and electronic equipment exportsexports and their domestic and imported contents (in billions of $ and percentage)

Source: WTO, based on IDE-JETRO Asian Input-Output tables

United states china trade balance traditional versus va measure in billions of us
United States-China trade balance exportsTraditional versus VA measure (in billions of US$)

Sources: UN Comtrade Database, IDE-JETRO AIO table and WTO estimates

Summary of the benefits of trade in value added analysis
Summary of the benefits of trade in value added analysis exports

  • 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)