Towards Global Production Network of ICT Industry

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Towards Global Production Network of ICT Industry

• Chong Sup Kim
• Seoul National University

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What are the Macroeconomic effects?
3
Macroeconomic effects of an FTA between Korea and
Mexico
Simulations using CGE Model
4
Are there any additional effects?What was the
experience with the others??
5
Trade between Korea and Chile after FTA
million
4,000
3,500
Chile ? Korea
3,000
Korea ? Chile
2,500
2,000
1,500
1,000
500
0
1991
1993
1995
1997
1999
2001
2003
2005
6
Case1 Elimination of low tariffs
250,000
200,000
Methanol
(tariff 2 ? 0)
150,000
1000
Ingot
100,000
(tariff 5 ? 0)
50,000
0
1999
2000
2001
2002
2003
2004
2005
2006
1997
1998
7
Case2 Large tariff reduction
60,000
streaky pork
50,000
(tariff 25 ? 16.7)
40,000
Red wine
30,000
1000
(tariff 30 ? 5)
20,000
Kiwifruit
10,000
(tariff 45 ? 29)
0
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
8
Case3 Small tariff reduction
40,000
Flours, meals and
35,000
pellets of fisch (tariff 5 ? 3.2)
30,000
25,000
1000
20,000
15,000
Atrantic salmon
10,000
(tariff 10 ? 3.3)
5,000
0
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
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Case4 Awareness effect
180,000
160,000
Roasted
140,000
(tariff 0 ? 0)
120,000
100,000
1000
80,000
bleached
60,000
(tariff 0 ? 0)
40,000
20,000
0
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
10
Mexicos major imports from Korea
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Koreas Major Imports from Mexico
(units 1,000 and percentage)
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Possible damages to the industrial sectors?
13
Export Similarity Index in Mexico
60
Korea-Japan
50
Korea-USA
Korea-China
40
30
20
10
0
1995
2000
2005
2006
14
Top 10 export products to Mexico
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Effects on High-Tech Industry??
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Export and Comparative advantage of Mexicos
telecommunication and computer industry in US
market.
Patent numbers, Computers Communications
11.00
10.00
9.00
Communications
8.00
Computer hardware and software
7.00
6.00
5.00
Computer peripherals
4.00
Information storage
3.00
2.00
1.00
0.00
1982
1983
1984
1985
1986
1987
1988
1989
1990
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
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RCA and RTA of Mexicos Telecommunication and
Computer Industry
Telecommunication Computer in USA
1.80
1.60
1.40
1.20
1.00
0.80
0.60
0.40
0.20
0.00
1989
1990
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
RCA
RTA
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Flow of ICT parts and components 1992
Korea
Japan
China
Thailand
Hong Kong
Philippines
Singapore
Indonesia
Malaysia
More than 1.0 of world exports
0.11.0 of world exports
Less than 0.1 of world exports
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Flow of ICT parts and components 2005
Korea
Japan
China
Thailand
Hong Kong
Philippines
Singapore
Indonesia
Malaysia
More than 1.0 of world exports
0.11.0 of world exports
Less than 0.1 of world exports
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Flow of ICT parts and components
1992
2005
USA
USA
1.50
1.80
2.50
0.78
1.26
1.03
3.26
1.19
0.02
0.01
Canada
Mexico
Canada
Mexico
0.01
0.05
Note the numbers represent the share in world
exports ()
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Flow of ICT parts and components 1992
N. Europe
BeNeLux
U.K.
Germany
France
E. Europe
Italy
Iberia
Others
More than 1.0 of world exports
0.11.0 of world exports
Less than 0.1 of world exports
22
Flow of ICT parts and components 2005
N. Europe
BeNeLux
U.K.
Germany
France
E. Europe
Italy
Iberia
Others
More than 1.0 of world exports
0.11.0 of world exports
Less than 0.1 of world exports
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Exports of ICT Sector
1992
2005
ASIA RS 42.7 IR 33.2
ASIA RS 55.2 IR 54.6
5.4
9.3
3.7
9.1
14.9
2.0
10.5
2.5
NAFTA RS 22.9 IR 35.6
EU RS 32.0 IR 68.2
NAFTA RS 14.1 IR 44.6
EU RS 28.7 IR 64.2
2.1
5.9
2.8
1.8
Note RS represents regional share in world
exports () IR represents share
intraregional trade ()
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Koreas FDI in Mexico
80
70
60
50
million
40
30
20
10
0
1989
1990
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
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Sectoral Distribution of Koreas FDI
Telecomm
10
Wholesale
24
Manufacture
60
Construction
6
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International Division of Labor
Korean ICT Exports to Mexico finished vs.
intermediate products
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Flow of Auto parts and components 1992
Korea
Japan
China
Thailand
Hong Kong
Philippines
Singapore
Indonesia
Malaysia
More than 0.5 of world exports
0.10.5 of world exports
Less than 0.1 of world exports
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Flow of Auto parts and components 2005
Korea
Japan
China
Thailand
Hong Kong
Philippines
Singapore
Indonesia
Malaysia
More than 0.5 of world exports
0.10.5 of world exports
Less than 0.1 of world exports
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Flow of Auto parts and components
1992
2005
USA
USA
4.28
2.73
6.23
5.50
1.52
3.98
10.10
7.95
0.13
0.13
Canada
Mexico
Canada
Mexico
0.11
0.06
Note the numbers represent the share in world
exports ()
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Flow of Auto parts and components 1992
N. Europe
BeNeLux
U.K.
Germany
France
E. Europe
Italy
Iberia
Others
More than 1.0 of world exports
0.11.0 of world exports
Less than 0.1 of world exports
31
Flow of Auto parts and components 2005
N. Europe
BeNeLux
U.K.
Germany
France
E. Europe
Italy
Iberia
Others
More than 0.5 of world exports
0.10.5 of world exports
Less than 0.1 of world exports
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Exports of Automobile Sector
1992
2005
ASIA RS 23.7 IR 11.4
ASIA RS 21.0 IR 15.0
0.8
3.7
0.5
5.0
10.2
8.1
2.2
1.8
NAFTA RS 21.7 IR 78.0
EU RS 52.5 IR 77.1
NAFTA RS 20.5 IR 82.7
EU RS 53.5 IR 72.9
1.4
1.4
3.1
5.7
Note RS represents regional share in world
exports () IR represents share
intraregional trade ()
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Towards Global Production Network of ICT Industry
Thank You