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Services and Global Value Chains

The Asia-Pacific Reality

image of Services and Global Value Chains

The study on ‘Services and Global Value Chains: Asia-Pacific reality’ reviews the facts and issues related to the roles of services in global value chains. It provides the framework to understand and assess the linkages among different services as well as between services and manufacturing industries. It offers evidence on the contributions of services in the global value chains in Asia-Pacific region and the rest of the world. It also includes case studies about the services inputs to the value chains of specific industries in the region. The study also reviews current policy issues related to trade in services. Ultimately, the study provides lessons for Asia-Pacific economies which see services and participation in GVCs as important pathways toward sustainable development.

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The roles of services in international trade and Global Value Chains: A conceptual framework

This chapter discusses the important roles of services in the Global Value Chains (GVCs). It highlights the fact that, similarly for goods, the roles of services in GVCs are critical inputs to GVCs as well as constituting GVCs in their own right. In addition, international fragmentation can occur in the value chain of services, just like goods. The globalization of production in the services industry began around the middle of the 1990s, about 20 years after it had begun in the manufacturing sector (Stephenson, 2012). Similar to the manufacturing sector, new technologies – especially information technology and telecommunications – have allowed the production of service components to be disseminated to different parts of the world. However, despite several similarities, services have distinct characteristics from goods. They are not just inputs but also the glue that holds value chains together. In addition, services differ from goods in how they are transacted and delivered, how they are linked with the rest of domestic economy, how they are regulated, how international cooperation can contribute to integration of national markets, or how they are measured. Therefore, services deserve special attention in a discussion about GVCs.

English

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