Transcript INTERNATIONAL PATTERNS OF INDUSTRY AND FINANCE

INTERNATIONAL PATTERNS OF
INDUSTRY AND FINANCE
Group members:
1. Ngô Lê Quỳnh Tiên
2. Nguyễn Thị Thu Thảo
3. Chung Minh Tâm
4. Huỳnh Thúy An
5. Phan Thị Thường Linh
OUTLINE
Generalisation
a. Overall Framework
b. Important Trends
2) Patterns of International Trade
3) Patterns of International Aid
1)
Overall Framework
Core economics:
 70% of manufacturing value added (MVA)
Share of World Total MVA
21.1
U.S
Japan
40.2
China
19
4.2
Germany
France
7.5
8
Others
Overall Framework
Productivity
 Highly capitalized manufacturing industries  high
levels of worker productivity
 high share of manufacturing in GDP
TREND
The first trend of shifting dominant
position in the world economy
Japan
China
U.S’s dominance
United Kingdom
TREND
The second trend of international
industrial production and employment
The second
trend
Trend
About TNCs
Reason
TNCs
Effect
Production
effect
Government
effect
TREND
The rapid growth of manufacturing
employment and productivity in China
and the newly industrializing
economies of East Asia
Eg: China and the four Asian “Tigers” – HongKong,
Singapore, South Korea and Taiwan
Reason
Corporate
strategies
Particularly
ones of large
transnational
corporations
(TNCs)
Globalizatio
n of
economic
activity
(the overarching
component of the
world’s economic
geography)
The
second
trend
About TNCs
The importance of TNCs
in the world economycompare their annual
turnover with the Gross
National Income (GNI)
All top 50 global TNCs >
many of the world’s
smaller LDCs ( Less
Developed Countries)
The very biggest TNCs
are comparable in size
with countries: Greece,
Ireland, Portugal and
New Zealand
Production Effect
5oo largest US & Japanese corporations employ
overseas labour force in LDCs, particular, the
NICs ( New Industrializing Countries)
2/3 of the radios made by Japanese
manufacturing companies are produced
abroad- mostly in South Korea & other nearby
East Asian locations
Over 90% of South Korean exports of
electronic equipment are produced by affiliates
of Japanese companies
Government Effect
Government of LDCs have sought to take advantage of
TNCs needs for cheap labour
Setting up Export Processing Zones (EPZs)
Adaptions of free trade zone => favourable investment and trade conditions
are created
EX: the resourcce- poor island of Mauritius had more than 500 companies operating
within its EPZ, over 90,000 workers, many of firms are foreign owned/ owned jointly
with foreigners.
In 2000, exports from these firms exceeded $1.2bil => 75% of country’s exports
Government Effect
At more general level, government everywhere have
responded to the “global reach” of TNCs
=> intensifying their involvement with supranational
economic and political organizations
=> European Union (EU)
Association of South East Asian Nations (ASEAN)
North American Free Trade Agreement (NAFTA)
PATTERNS of International Trade





Fundamental structure: trading blocs
Membership: + distance,
+legacy of colonial relationship
+ geopolitical alliances
- Ex : western Europe, together with some former European
colonies in Africa, South Asia, the Caribbean and Australasia
PATTERNS of International Trade

Other cases: Autarky
Many countries don’t contribute significantly to the
flows of imports & exports constitute the geography
of trade.
EX: Central African Republic
Changes in Geography of Trade
Due to :
 Innovations in transport, communications and
manufacturing technology
 Shifts in global politics
 The increasing internationalization and flexibility of
production processes.
The most striking aspect of commodity flows and
the regionalization of trade is the persistence of the
dependence of LDCs on trade with developed
countries that are geographically or geopolitically
close.
Ex : Algeria – Cambodia – Côte d’Ivoire

France
Patterns of International Aid
Debt
issue
‘tied’ to donor
countries’ exports,
specific military,
educational/cultural
projects
AID
Its geography has a
strong political flavor,
which means
• Localized political
aspirations
• Colonial ties
Viewed as useful
weapon to establish
and preserve political
influence
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