africa

Yale Center for the Study of Globalization
Trade patterns also tend to be complex and multi-country. Evidence from OECD
and WTO (2013a) suggests that typically about one third of imported intermediate
goods are destined for the export market, with higher ratios in smaller economies
(e.g. up to two-thirds in a country like Hungary) and in certain sectors. For example,
the foreign content of electronic goods exports from China and Korea is 40 percent,
and in those from Mexico it reaches 60 percent.
Finally, services play an important role. While services trade has long been underestimated,
recent analysis suggests that within most manufacturing sectors, services
represent more than one-third of the value of exports. When the services components
of manufactured exports are added to the value of trade in services itself, services are
seen to represent more than half of the value of exports for most OECD countries,
and a third of the exports of an emerging country like China (OECD-WTO, 2013a).
16.2.2 Old and new paradigms in trade and development
The emergence of GVCs and new trade patterns suggests the need to revise public
strategies that aim at fostering competitiveness, as well as to rethink trade and
development policies at large. Such a rethinking needs to take account of four major
paradigm changes (Figure 16.1 and Cattaneo and Miroudot, 2015):
• The change of relevant strategic framework from countries to firms and GVCs.
Competitiveness strategies should be tailored to trade and industrial organizations.
Countries are no longer the relevant framework for analysis; policymakers
should think business and think global—or at least regional. A country cannot
develop a competitive offer of goods or services in isolation.
• The change of relevant economic framework from industries to tasks and business
functions. The objective is not to develop domestic industries that will
capture all the segments of production or the whole value chain; it is to identify
the country’s best position in a GVC and the most competitive supply of tasks
or business functions.
• The change of relevant economic assets from endowments and stocks to flows.
International competition is increasingly vertical, and firms are simultaneously
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