Volume 41, Issue 3
The Turning Point of Global Value Chain's Position in Emerging East Asian
Economies
Hiroyuki Taguchi
Saitama University

Ken Nibayashi
Saitama University

Abstract
This paper aims to examine the dynamic process of participation in global value chains (GVCs) along with
development stages in emerging East Asian economies by using the GVC indexes and the UNCTAD-Eora Global
Value Chain Database. The main research focus of this study is to investigate a turning point of the GVC position
from a downstream-driven participation to an upstream-driven one, which reflects an industrial upgrading from abuyer position for industrial inputs to a supplier position for them. The empirical estimation could verify the U-shaped
curve in the combination between the GVC position index and per capita GDP, and identify a turning point of the
GVC position in the reasonable range of per capita GDP. The estimation result also showed variability of the turning
points in per capita GDP among the sectors: 3,668 US dollars in total industry, 6,088 US dollars in manufacturingsector, and 9,510 US dollars in machinery industry.

Citation: Hiroyuki Taguchi and Ken Nibayashi, (2021) ''The Turning Point of Global Value Chain's Position in Emerging East Asian
Economies'', Economics Bulletin, Vol. 1 No. 3 pp. 1826-182
Contact: Hiroyuki Taguchi - htaguchi@mail.saitama-u.ac.jp, Ken Nibayashi - ken.nibayashi@gmail.com.
Submitted: March 18, 2021. Published: September 17, 2021.

1. Introduction
Global value chains (GVCs) have been a remarkable trend in the world economic
activities over the past decades, and have also been one of the great concerns for policy
makers and academic circles. The GVCs are described by UNCTAD (2013), namely, theWorld Investment Report 2013, in such a way as the fragmentation of production
processes, and the international dispersion of tasks and activities among the economies
with diversified development stages, which have led to the emergence of borderless
production networks. The GVCs are considered to boost an economic growth, as the
specialization in production processes enhances efficiency and productivity, and the
durable firm-to-firm relationships promote the diffusion of technology along the chains.
World Bank (2020), for instance, estimated that a 1 percent increase in GVC participation
would boost per capita income by more than 1 percent, or cause a much more than 0.2
percent income gain from standard trade.
From an academic perspective, the causes and economic effects of the GVCs havebeen intensively investigated by theoretical and empirical studies. The concept of GVCs
was initially introduced by Hummels et al. (2001) in terms of the “vertical specialization”.
Koopman et al. (2010) and (2014) then generalized formally the concept of verticalspecialization to account for all sources of value-added in gross exports in a multi-country
multi-sector framework, and thus integrated vertical specialization and value-added tradein the literature. In accordance with their GVC conceptualization, the value-added-trade
data have been developed by several international organizations such as OECD, WTO
and UNCTAD, and the database has enabled us to analyze the value added contributionsof gross exports. In fact, the combination of the GVC conceptualization and its databasedevelopment has led to a great number of empirical works on GVC (e.g., Li et al. 2019,
Gereffi 2018, UNCTAD 2013, World Bank 2016 and 2020).
The GVCs characterized by vertical specialization have been discussed also by the“fragmentation” theory in the context of intra-industry trade, as in Jones and Kierzkowski(1990, 2005) and Deardorff (2001). Kimura (2006) and Kimura et al. (2007), following
the fragmentation theory, argued that the mechanics of the East Asian value chains arecharacterized by the “vertical” division of labor in “intra-industries” among a number ofcountries with different income levels, and that the mechanics are typically found in such
sophisticated manufacturing industries as machinery, which involve many multi-layered
vertical production processes. Thus, from the geographical perspective, emerging market
economies in East Asia with different factor prices under different development stages
could be one of the major players in GVCs in terms of intra-industry trade.

The pattern for engaging in GVCs contains not monotonous but dynamic processes.
Taking an example of China’s GVC participation process, China started with pureassembling activities in producing and exporting manufacturing items such as Apple
iPods and iPhones by importing their parts and components from Japan, Korea, and theUnited States, and its value added accounted for only a small fraction of their selling
prices (e.g., Backer 2011, Xing and Detert 2010, and Linden et al. 2009). In recent times
since the mid-2000s, however, China’s GVC participation has shown a different patternfrom the “downstream” to the “upstream” contribution to GVCs with industrial upgrading(e.g., Zhu 2019, Peng and Zhang 2020). Li et al. (2019) emphasized that the Chinese
economy has played an increasingly significant role as a supply hub in its GVC activities.
In general, the dynamic process of GVC participation were described by previous
studies in the following ways. Kuroiwa (2016) depicted the GVC involvement as
consisting of two phases — participation and upgrading — that require different
development strategies, and argued that the second phase is more challenging for many
developing countries. UNCTAD (2013) found a set of distinct “GVC development path”
in host countries participating GVCs: some emerging market economies have managed
to regain the domestic value added share to exports, after its decline at the initial stage of
GVC participation, through upgrading productive capacities within GVCs and by
expanding them into higher-value chains, as in the Philippines, Malaysia and Thailand.
Taguchi (2014) analyzed the dynamic process of domestic value creation in GVCs byeight manufacturing sectors in Asian economies. World Bank (2020) showed regularities
in the type of GVC integration (backward and forward GVC participations) dependingon the degree of countries’ industrial upgrading. The report classified 146 countries into
four taxonomy groups by their degree of industrial upgrading: commodities, limited
manufacturing, advanced manufacturing and services, and innovative activities. Then, thereport described the patterns of GVC participations along with industrial upgrading asfollows: the backward GVC participation with an inverted-U shape peaks out at theinnovative activities as this stage requires less imported inputs; and the forward GVC
participation with a U shape bottoms out at the advanced manufacturing and services as
this stage starts to increase inputs to third countries.
This paper examines the dynamic process of GVC participation along with
development stages in emerging East Asian economies, by using GVC indexes proposedby Koopman et al. (2010), based on the UNCTAD-Eora Global Value Chain Database(UNCTAD-Eora Database). 1 The study targets seven economies: China, Malaysia,
1

See the website: https://worldmrio.com/unctadgvc/. (Accessed December 1, 2020) The property ofthis database will be explained in Section 2.

Thailand, Indonesia, the Philippines, Vietnam, and Cambodia 2 ; and four industrial
categories:

total

industry,

manufacturing,machineryandnon-machineryinmanufacturing. The main research focus of this study is to investigate a turning point of
the GVC position from a downstream-driven participation to an upstream-driven one, as
the turning point reflects an industrial upgrading from a buyer position for industrial
inputs to a supplier position for them.
The remainder of the paper is structured as follows. Section 2 illustrates the dynamic
process of GVC participation in the individual East Asian economies by using Koopman’s
GVC indexes; Section 3 conducts an econometric analysis to find out a turning point in
the GVC position from a downstream-driven participation to an upstream-driven one; andSection 4 summarizes and concludes.

2. GVC Participation in Emerging East Asian Economies
This section observes the dynamic process of GVC participation in the individual
East Asian economies by using Koopman’s GVC indexes, based on the UNCTAD-Eora
Database. Koopman et al. (2010) constructed an index to gauge whether a country is
likely to be in the upstream or downstream of the GVC position in any particular sector,
and also a separate index to gauge the extent to which a country-sector participates in the
GVCs. Their two kinds of indexes are presented as follows.
GVC_Positionir = ln (1 + IVir / Eir) – ln (1 + FVir / Eir)(1)

GVC_Participationir = IVir / Eir + FVir / Eir(2)

where the subscripts i and r denote a country and a sector, respectively; and IV, FV, andE stand for “domestic value-added embodied in intermediate exports used by the direct
importer to produce goods for third countries (indirect value added exports)”, “valueadded from foreign countries embodied in gross exports (foreign value added used inexports), and “gross exports,” respectively. In Equations (1) and (2), the first item (IV /E) represents a GVC upstream participation, and the second item (FV / E) shows a GVC
downstream participation. These two indices can be computed for any countries (i) and
sectors (r). Then, Equation (1) denotes the country-sector’s GVC position: if the countrysector lies upstream in a GVC, the numerator tends to be large, but if it lies downstream,2

The study excludes Lao PDR and Myanmar, which are resource-rich countries and less linked with
global value chains.

then the denominator tends to be large. Equation (2) describes the total extent of GVC
participation in a country-sector.
The necessary data for computing the GVC indexes above are provided by the
UNCTAD-Eora database in this study.3 The database offers the GVC data with global
coverage (189 countries and a “Rest of World” region) and a time series from 1990 to
2018, and provides the key GVC indicators: foreign value added (FVA), domestic value
added (DVA), and indirect value added (DVX) for total industry. The variables of IV and
FV in Equation (1) and (2) correspond to DVX and FVA in the UNCTAD-Eora database,respectively.
Figure 1 displays the trends for 1990-2018 in GVC position and participation indexes
and their components (GVC upstream and downstream participations relative to grossexports) in seven emerging East Asian economies with a focus on total industry. Looking
at the components of the indexes first by the left side, it is found that there are the different
trends under the different income groups: in the relatively higher income group (China,
Malaysia, Thailand, Indonesia and the Philippines), the GVC upstream participation
follows an increasing trend while the downstream one shows an inverted-U-shaped curveor flat trend. In the relatively low income group (Vietnam and Cambodia), on the other
hand, the GVC upstream participation does not show an increasing trend and the down
stream one reveals an increasing or flat trend. This difference is typically reflected in the
shapes of the GVC position index, that is, a U-shaped curve commonly in the high income
group and a declining trend in the low income group. The GVC participation index, on
the other hand, does not have a clear common trend.
The trend in the GVC position index described above implies that the pattern of the
GVC participation has been transformed from a downstream-driven participation to an
upstream-driven one at some turning point in the development stages in emerging East
Asian economies.

3

The methodological background of the UNCTAD-Eora database was described by Casella et al.
(2019). The value-added-based trade data originated from the work of the OECD and WTO as the“Trade in Value Added (TiVA)” dataset (see OECD and WTO, 2012). Thus, Casella et al. (2019) also
provided a comparison of the results of the UNCTAD-Eora database against the TiVA database.

Figure 1 GVC Indexes in Emerging East Asian Economies
China: GVC participations

China: GVC indicators
GVC position (left axis)

Downstream participation

GVC participation (right axis)
0.50

0.18
0.16
0.14
0.12
0.10
0.08
0.06
0.04
0.02
0.00

Malaysia: GVC participations

2018

2016

2014

2012

2008

2010

Malaysia: GVC indicators

0.40

2018

2016

2014

2012

2010

2008

GVC participation (right axis)
0.700

2004

2000

2002

-0.05

1998

0.50

1996

0.00

1994

0.60

1992

GVC position (left axis)

Downstream participation
1990

Upstream participation

2006

0.00

2004

2016

2018

2014

2012

2010

2008

2004

2006

2002

2000

1998

1994

1996

1992

1990

0.00

0.10

2002

0.05

0.20

2000

0.10

1996

0.15

0.30

1998

0.20

0.40

1994

0.25

1992

0.30

1990

0.35

2006

Upstream participation

0.660
0.640

-0.10

0.30

0.620

-0.15

0.600

0.20

0.580

-0.20

0.10

0.560

-0.25

2018

2016

2014

0.540
0.520

-0.30

Thailand: GVC indicators

2018

2016

2012

2014

2010

2008

GVC participation (right axis)
0.60

2004

2000

-0.02

0.30

1998

0.35

1996

0.00
1994

0.40

1992

GVC position (left axis)

1990

Downstream participation

2006

Thailand: GVC participations
Upstream participation

2002

2012

2010

2008

2006

2004

2002

2000

1998

1994

1996

1992

1990

0.00

0.680

0.50

-0.04

0.25

0.40

-0.06

0.20

2018

2016

2014

2012

2010

2008

2006

2004

2002

-0.14

2000

0.00
1998

-0.12

1994

0.05

1996

0.10

-0.10

1992

-0.08

1990

0.15

0.30
0.20
0.10

-0.16

0.00

Indonesia: GVC participations
Upstream participation

Indonesia: GVC indicators

Downstream participation

0.45
0.40
0.35
0.30
0.25
0.20
0.15
0.10
0.05
0.00

GVC position (left axis)
0.25

GVC participation (right axis)
0.60

0.20

0.50

0.40

0.15

0.30
0.20

2018

2016

2014

2012

2010

2008

2006

2004

2002

2000

1998

1996

0.00

1994

0.10

0.00

1992

0.05

1990

2018

2016

2014

2012

2010

2008

2006

2004

2002

2000

1998

1994

1996

1992

1990

0.10

Philippines: GVC participations

Philippines: GVC indicators

Downstream participation

2018

2016

2012

2014

2010

2006

2008

2004

2000

0.40

2002

0.66
1996

0.00

-0.05

1998

GVC participation (right axis)
0.68

1994

0.50

0.05
1992

0.60

GVC position (left axis)

1990

Upstream participation

0.64
0.62

-0.10

0.30

0.60

-0.15
0.20

0.58

2016

2018

2014

Vietnam: GVC indicators

2018

2016

2004

2000

2002

1998

1996

1994

1992

1990

2014

GVC participation (right axis)
0.70

0.00

2012

0.45
0.40
0.35
0.30
0.25
0.20
0.15
0.10
0.05
0.00

GVC position (left axis)

2010

Downstream participation

2008

Vietnam: GVC participations
Upstream participation

2006

2012

2010

2008

2004

2006

2002

2000

0.52

1998

-0.30

1994

0.54

0.00

1996

-0.25
1992

0.56

0.10

1990

-0.20

-0.05

0.60
0.50

0.40
-0.10
0.30

0.20

-0.15

2018

2016

2014

2012

2010

2008

2006

2004

2002

2000

1998

1994

1996

1992

1990

0.10

-0.20

0.00

Cambodia: GVC indicators

Cambodia: GVC participations
Upstream participation

GVC position (left axis)

Downstream participation

0.30

0.20

0.25

0.15

0.20

GVC participation (right axis)
0.45
0.40
0.35

0.10

0.30

0.15

0.25

0.05

0.20

0.10

2018

2016

2014

2012

2010

2008

2006

2004

2002

2000

1998

1994

1996

1992

1990

-0.10

2018

2016

2014

2012

2010

2008

2006

2004

2000

2002

1998

1996

1994

-0.05

0.00

0.15
1992

0.05

1990

0.00

0.10
0.05

0.00

Sources: Author’s estimation based on the UNCTAD-Eora database

3. Econometric Analysis of Turning Point in GVC Position
This section conducts an econometric analysis to find out a turning point in the GVC
position from a downstream-driven participation to an upstream-driven one in emerging
East Asian economies. This section start with a model specification, followed by thedescription of data and samples, and estimation outcomes and discussions.

3.1

Model Specification

The turning point in the GVC indexes is examined in the combination between the
GVC indexes and the economic development stages in terms of per capita real GDP, forthe categories of total industry, manufacturing, machinery and non-machinery of sample
economies. The estimation model is specified as follows:
GVC_Indexir,t = α0 + α1 ln PCYi,t + α2 ln mpoi,t + α3 fi + ei,t(3)

GVC_Indexir,t = β0 + β1 ln PCYi,t + β2 ln (PCYi,t)2 + β3 ln mpoi,t + β4 fi + ei,t(4)where the subscripts i, r, and t denote countries (seven emerging East Asian countries
presented in Introduction), sectors (categorized into total industry, manufacturing,machinery and non-machinery) and years (for 1990-2018), respectively; GVC_Index
stands for the GVC position index as well as the GVC participation index; PCY means
per capita GDP in a real term; mpo is a market potential; f is a time-invariant countryspecific fixed effect; e is a residual error term; α0…3 and β0…4 are estimated coefficients,
respectively; and ln shows a logarithm form.
This study applies a fixed-effect model represented by f for the panel estimation. It
is because there should be exogenously given country-specific factors (e.g., geographicalproperty and institutional system) that are supposed to affect the GVC indexes, and amodel specification that ignores these factors would lead to an inefficient estimation.
Aside from controlling the time-invariant fixed-effects, this study also handles the “timevariant” country-specific effects. There are plenty of candidates for the variables tocapture those effects (e.g., human capital development and productivity improvements)that would indeed affect the GVC indexes. However, these variables might, once inserted
in Equation (3) and (4), induce multicollinearity with per capita GDP (PCY) or anotherendogeneity problem with the error terms. Carefully selecting them, this study focuses on
the “market potential” as a time-variant country -specific factor, as it can be hardly
correlated with the country’s PCY. The Market potential is computed based on themeasuring method proposed by Krugman (1992): a weighted sum of the partner country's
GDP with the weights depending inversely on geographical distance.
The estimation is conducted in a linear form in Equation (3) and in the quadratic formin Equation (4). The turning point of the GVC position index under a U-shaped curve isidentified in the estimation of Equation (4), in case that β1 < 0 and β2 > 0 hold significantly,
and that the calculated value –β1 / (2 β2) for the turning point falls within a reasonable
range of per capita GDP as an emerging market economy.

3.2

Data and Sample for Estimation

The GVC indexes in total industry are computed as in Section 2 using the UNCTADEora database for 1990-2018. The indexes in manufacturing, machinery and non-machinery sectors are calculated using the country/sector-by-country matrix and thecountry-by-country/sector matrix for all years from 1990 to 2017 in the UNCTAD-Eora
database, by reorganizing the commodity classification of sample countries as shown inAppendix. The data for per capita GDP (PCY) are retrieved from the UNCTAD Stat4 by
the series of “gross domestic product per capita, US dollars as constant prices (2010).”For computing the market potential (mpo), the GDP and geographical distance arerespectively from the UNCTAD Stat and "dist_cepii" included in the GeoDist database
compiled by CEPII 5 . The study then constructs a set of panel data of seven sample
countries for 1990-2018 in total industry and for 1990-2017 in manufacturing, machineryand non-machinery sectors.

3.3

Estimation Outcomes and Discussions

Table 1 and Figure 2 report the estimation outcomes on the GVC position andparticipation indexes. Focusing on the GVC position index first, the quadratic estimationof Equation (4) produces more consistent and appropriate results than the linear
estimation of Equation (3). In the estimation of Equation (4), β1 < 0 and β2 > 0 are verified
at 99 percent significant level so that the U-shaped curves can be valid in all the sectoral
cases, while in the one of Equation (3), α1 is insignificant (the linear correlation is invalid)in the non-manufacturing case. In addition, the values of adjusted R-squared are higher
in the quadratic estimation than in the linear estimation in all the sectoral cases. As for
the GVC participation index, neither estimation of Equation (3) nor (4) shows consistentoutcomes: α1 is insignificant in the machinery in the linear estimation, and β1 and β2 are
insignificant in the total industry and manufacturing in the quadratic estimation.
The U-shaped curve identified in the GVC position estimation with per capita GDP
is consistent with the previous studies’ findings that the GVC downstream-driven
participation has been transformed into the upstream-driven participation along withindustrial upgrading in accordance with economic development (e.g., Li et al. 2019 andWorld Bank 2020). It should be also worth noting that all the turning points represented
by –β1 / (2 β2) in the GVC position index falls within a reasonable range in terms of percapita GDP, but they show variability among the sectoral cases as shown in Figure 2. The
turning point of manufacturing sector (6,088 US dollars) is higher than that of totalindustry (3,668 US dollars), and among manufacturing sector, the tuning point ofmachinery (9,510 US dollars) is much higher than that of non-machinery sector (2,264
4
5

See the website: https://unctadstat.unctad.org/EN/. (Accessed December 1, 2020)
See the website: http://www.cepii.fr/cepii/en/bdd_modele/presentation.asp?id=6. (Accessed
December 1, 2020)

US dollars). It suggests that the machinery industry involving sophisticated skills andtechnologies requires the higher development stage to upgrade its GVC position from thebuyer of value added in the downstream position to its supplier in the upstream position.
This sectoral outcome in the GVC position is also in line with the finding of Taguchi(2014), which showed that the turning point of the domestic value creation in the GVC
participation process fall in the higher per capita GDP in the industries of machinery,electrical and transport equipment than in the other manufacturing industries in Asiandeveloping economies.
Figure 3 displays the positions of per capita GDP in 2018 of individual emerging East
Asian economies in comparison with the turning points of the GVC position index of totalindustry, manufacturing and machinery. Cambodia, Vietnam and the Philippines do notreach the turning point of total industry (3.668 US dollars); the Philippines passes theturning point of total industry; Thailand and China stay beyond the turning point of
manufacturing (6,088 US dollars); and Malaysia is further beyond the turning point ofmachinery (9.510 US dollars).

4. Concluding Remarks
This paper examined the dynamic process of GVC participation along with
development stages in emerging East Asian economies, by using GVC indexes proposedby Koopman et al. (2010), based on the UNCTAD-Eora Database. The main research
focus of this study is to investigate a turning point of the GVC position from adownstream-driven participation to an upstream-driven one, which reflects an industrial
upgrading from a buyer position for industrial inputs to a supplier position for them.
The empirical estimation could verify the U-shaped curve in the combination
between the GVC position index and per capita GDP, and identify a turning point of the
GVC position in the reasonable range of per capita GDP. The estimation result also
showed variability of the turning points in per capita GDP among the sectors: 3,668 US
dollars in total industry, 6,088 US dollars in manufacturing sector, and 9,510 US dollars
in machinery industry.

Table 1 Estimation Results[Dependent Variable: GVC Position]
Total industry
Const.
ln PCYEquation (3)0.339 ***
(3.957)-0.068 ***(-5.740)ln (PCY)2
ln mpoTurning Point USD
Adj R**2
Sample size
Manufacturing
Const.
ln PCY

0.088 ***
(13.505)0.820
203
Equation (3)0.291 **
(2.304)-0.078 ***(-4.466)

ln (PCY)2
ln mpoTurning Point USD
Adj R**2
Sample size
Machinery
Const.
ln PCY

0.091 ***
(14.403)0.832
196
Equation (3)0.551 **
(2.522)-0.124 ***(-4.140)ln (PCY)2
ln mpoTurning Point USD
Adj R**2
Sample size
Non machinery
Const.
ln PCY

0.125 ***
(12.881)0.826
196Equation (3)0.000(0.005)-0.020(-1.565)

ln (PCY)2
ln mpoTurning Point USD
Adj R**2
Sample size

0.033 ***
(5.735)0.843
196

Equation (4)2.484 ***
(13.145)-0.657 ***(-14.442)
0.040 ***
(14.431)0.078 ***
(12.691)
3,668
0.864
203
Equation (4)1.779 ***
(7.317)-0.488 ***(-8.916)0.028 ***
(8.968)0.083 ***
(14.674)
6,088
0.852
196
Equation (4)2.348 ***
(3.271)-0.620 ***(-3.609)
0.033 ***
(3.361)0.116 ***
(16.069)
9,510
0.844
196
Equation (4)1.361 ***
(7.846)-0.396 ***(-10.027)
0.025 ***
(10.431)0.027 ***
(4.242)
2,285
0.868
196

[Dependent Variable: GVC Participation]
Total industry
Const.
ln PCYEquation (3)0.057(1.101)
0.056 ***
(8.525)0.008(0.290)Equation (4)0.248 *
(1.765)0.003(0.101)0.003(1.620)0.007(0.937)

0.894
203

0.894
203

Equation (3)0.039(0.656)
0.062 ***
(6.915)-0.022 ***(-2.985)

Equation (4)0.092(0.511)0.047(1.042)0.000(0.325)-0.023 ***(-2.911)

0.926
196

0.926
196

Equation (3)0.574 ***
(8.149)0.012(1.287)Equation (4)-0.247(-0.571)
0.239 **
(2.175)-0.015 **(-2.189)-0.023 **(-2.134)
2,285
0.749
196

ln (PCY)2
ln mpoTurning Point USD
Adj R**2
Sample size
Manufacturing
Const.
ln PCYln (PCY)2
ln mpoTurning Point USD
Adj R**2
Sample size
Machinery
Const.
ln PCYln (PCY)2
ln mpoTurning Point USD
Adj R**2
Sample size
Non machinery
Const.
ln PCY-0.027 ***(-2.724)0.747
196
Equation (3)0.013(0.237)0.049 ***
(5.611)0.010(0.224)Equation (4)0.466 **
(2.556)-0.075(-1.542)0.008 **
(2.536)0.008(0.954)

0.904
196

0.906
196

ln (PCY)2
ln mpoTurning Point USD
Adj R**2
Sample size

Note: ***, **,* denote the rejection of null hypothesis at the 99%, 95% and 90% level of significancein the coefficients.
Sources: Author’s estimation

Figure 2 Turning Point in GVC Position
Total industry

Manufacturing

0.3
0.2
0.1
USD

0.0
100

1,000

10,000

-0.1
-0.2
-0.3
-0.4
3,668
Total Industry-0.5

Machinery

6,088
Manufacturing

Non machinery

0.3
0.2
0.1
0.0
100

1,000

10,000

-0.1
-0.2
-0.3
-0.4
-0.5
-0.6

Sources: Author’s estimation

2,264
Non Machinery

9,510
Machinery

USD

Figure 3 Turning Point in GVC Position and Per capita GDP
Total Industry
3,668

Turning Point

Manufacturing
6,088

Machinery
9,510

Per capita GDP
2018

China
7,585
Malaysia
12,107
Thailand
6,342

Indonesia
4,286
The Philippines
3,021
Vietnam
1,961
Cambodia
1,200

Sources: Author’s estimation

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Appendix Industrial Classifications

China

Malasia

Crop cultivation; Forestry; Logging and transport of timber and bamboo; Livestock andlivestock products; Fishery; Technical services for agriculture, forestry, livestock and fishing;
Coal mining and processing; Crude petroleum products and Natural gas products; Ferrous ore
mining; Non-ferrous ore mining; Salt mining; Non-metal minerals and other mining; Scrap andwaste; Electricity and steam production and supply; Gas production and supply; Water
production and supply; Construction; Railway passenger transport; Railway freight transport;
Highway freight and passengers transport; Domestic public transport; Water freight andTotal Industry
passengers transport; Air passenger transport; Air freight transport; Pipeline transport;
Warehousing; Post; Telecommunication; Computing services and software; Wholesale andretail trade; Hotels; Eating and drinking places; Finance; Insurance; Real estate; Leasehold;Business services; Tourism; Scientific research; General technical services; Geologicalprospecting; Water conservancy ; Environmental resources and public infrastructure; Resident
services and other services; Educational services; Health services; Social welfare; Culture andarts, radio, film and television; Sports; Recreational services; Public administration and othersectors; Re-export & Re-import
Grain mill products; Feeding stuff production and processing; Vegetable oil and forage; Sugar
refining; Slaughtering, meat processing, eggs and dairy products; Prepared fish and seafood;
Other food products; Wines, spirits and liquors; Non-alcoholic beverage; Tobacco products;
Cotton textiles; Woolen textiles; Hemp textiles; Other textiles not elsewhere classified; Knitted
mills; Wearing apparel; Leather, furs, down and related products; Sawmills and fiberboard;
Furniture and products of wood, bamboo, cane, palm, straw, etc.; Paper and products; Printing
and record medium reproduction; Cultural goods; Toys, sporting and athletic and recreation
Manufacturing: non-machinery products; Petroleum refining; Coking raw chemical materials; Chemical fertilizers; Chemical
pesticides; Chemicals for painting, dying and others; Synthetic chemicals; Chemicals for
special usages; Chemical products for daily use; Medical and pharmaceutical products;
Chemical fibers; Rubber products; Plastic products; Cement and cement asbestos products;
Glass and glass products; Pottery, china and earthenware; Fireproof products; Other nonmetallic mineral products; Iron-smelting; Steel-smelting; Steel-processing; Alloy iron smelting;Nonferrous metal smelting; Nonferrous metal processing; Metal products; Arts and crafts
products; Other manufacturing products
Boiler, engines and turbine; Metalworking machinery; Other general industrial machinery;
Agriculture, forestry, animal husbandry and fishing machinery; Other special industrial
equipment; Railroad transport equipment; Motor vehicles; Vehicles fittings production; Shipbuilding; Other transport machinery; Generators; Household electric appliances; Other electric
Manufacturing: machinery
machinery and equipment; Communication equipment; Electronic computer; Other computerdevices; Electronic element and device; Electronic appliances; Other electronic andcommunication equipment; Instruments, meters and other measuring equipment; Cultural andoffice equipment
Agricultural products other; Rubber primary products; Oil Palm primary products; Coconut;
Tea; Livestock etc.; Forestry & logging products; Fish etc.; Crude petrol, natural gas &coal;
Metal ore; Stone, clay & sand quarrying; Electricity & gas; Water; Buildings & constructions;
Wholesale & retail trade; Hotels & restaurants; Transport; Communication; Banking services;
Other financial services; Insurance; Real estate; Ownership of dwellings; Business services;
Total Industry
Education – Private; Education – Public; Health – Private; Health – Public; Private non-profit
services; Entertainment; Radio & TV broadcasting; Recreation; Repair motor vehicles; Other
repair; Recycle products; Other private services; Public administration; Public order; Defense;
Other public administration; Imputed Bank Charges; Unspecified industry; Domestic Services;
Re-export & Re-import
Meat & meat products; Dairy products; Preserved fruits & vegetables; Preserved seafood; Oils
and fats; Grain mill products; Bakery products; Confectionery; Ice; Other foods; Animal feeds;
Wine and spirits; Soft drinks; Tobacco; Yarns & cloth; Knitted fabrics; Other textiles; Wearing
apparel; Leather products; Footwear; Sawmill products; Other wood products; Furniture; Paper
Manufacturing: non-machinery & board; Printed products; Industrial chemicals; Paints & lacquers; Drugs & medicines; Soap
& cleaning preparations; Other chemical products; Petrol & coal products; Processed rubber;
Rubber products; Plastic products; China, glass & pottery; Clay products; Cement, lime &plaster; Other non-metal products; Iron & steel; Non-ferrous metal; Other fabricated metal andfixtures; Structural metal products; Other metal products; Other manufacturing products
Industrial machinery; Household machinery; Radio, TV & com. Equipment; Elect. appliances &Manufacturing: machineryhouseware; Other electrical machinery; Ships & boats; Motor vehicles; Cycles & motorcycles;
Other transport equipment; Instruments & clocks

Thailand

Indonesia

Paddy; Maize; Cassava; Beans and Nuts; Vegetables; Fruits; Sugarcane; Rubber; Other
Cereals; Other Root Crops; Coconut; Oil Palm; Kenaf and Jute; Crops for Textile and Matting;Tobacco; Coffee and Tea; Other Agricultural Products; Agricultural Services; Cattle andBuffalo; Swine; Other Livestock; Poultry; Poultry Products; Silk Worm; Logging; Charcoal andFirewood; Other Forestry Products; Ocean and Coastal Fishing; Inland Fishing; Coal andLignite; Petroleum and Natural; Gas; Iron Ore; Tin Ore; Tungsten Ore; Other Non-ferrous Metal
Ore; Fluorite; Chemical Fertilizer; Minerals; Salt Evaporation; Limestone; Stone Quarrying;
Other Mining and Quarrying; Slaughtering; Electricity; Pipe Line; Water Supply System;
Residential Building Construction; Non-Residential Building Construction; Public Works for
Agriculture & Forestry; Non-Agricultural Public Works; Construction of Electric Plant;
Construction of Communication Facilities; Other Constructions; Wholesale Trade; Retail
Total Industry
Trade; Restaurant and Drinking Place; Hotel and Lodging Place; Railways; Route & Non Routeof Road Passenger Trans.; Road Freight Transport; Land Transport Supporting Services;
Ocean Transport; Coastal & Inland Water Transport; Water Transport Services; Air
Transports; Other Services; Silo and Warehouse; Post and Telecommunication; Banking
Services; Life Insurance Service; Other Insurance Service; Real-estate; Business Service;
Public Administration; Sanitary and Similar Services; Education; Research; Hospital Businessand Labor Associations; Other Community Services; Motion Picture Production; Movie
Theater; Radio, Television and Related Services; Library and Museum; Amusement andRecreation; Repair; Not Elsewhere Classified; Personal Services Unclassified; Re-export & Reimport
Canning Preserving of Meat; Dairy Products; Canning of Fruits and Vegetables; Canning
Preserving of Fish; Coconut and Palm Oil; Other Vegetable Animal Oils; Rice Milling; Tapioca
Milling; Drying and Grinding of Maize; Flour and Other Grain Milling; Sugar; Bakery Products;
Noodles and Similar Products; Confectionery; Ice; Monosodium Glutamate; Coffee and Tea
Processing; Other Food Products; Animal Feed; Distilling Blending Spirits; Breweries; Soft
Drinks; Tobacco Processing; Tobacco Products; Spinning; Weaving; Textile Bleaching and
Finishing; Made-up Textile Goods; Knitting; Wearing Apparels Except Footwear; Carpets andRugs; Cordage Rope and Twine Products; Pulp Paper and Paperboard; Paper Products;
Printing and Publishing Basic; Industrial Chemicals; Synthetic Resins and Plastics; Fertilizer
and Pesticides; Paints Varnishes and Lacquers; Drugs and Medicines; Soap and Cleaning
Manufacturing: non-machinery
Preparations; Cosmetics; Matches; Other Chemical Products; Petroleum Refineries; Other
Petroleum Products; Rubber Sheets and Block Rubber; Tires and Tubes; Other Rubber
Products; Plastic Wares; Cement Concrete and Cement Products; Ceramic and Earthen Wares;
Glass and Glass Products; Structural Clay Products; Other Non-metallic Products; Iron andSteel; Secondary Steel Products; Non-ferrous Metal; Cutlery and Hand Tools; Furniture and
Fixtures Metal; Structural Metal Products; Other Fabricated Metal Products; Tanneries; Leather
Finishing; Leather Products; Footwear Except Rubber; Saws Mills; Wood and Cork Products;
Furniture and Fixtures Wood; Scientific Equipment; Photographic & Optical Goods; Watches
and Clocks; Jewelry & Related Articles; Recreational and Athletic Equipment; Other
Manufacturing Goods
Engines and Turbines; Agricultural Machinery; Wood and Metal Working Machinery; Special
Industrial Machinery; Office and Household Machinery; Electrical Industrial Machinery; Radioand Television; Household Electrical Appliances; Insulated Wire and Cable; Electric
Manufacturing: machinery
Accumulator & Battery; Other Electrical Apparatuses & Supplies; Motor Vehicle; Motorcycle,
Bicycle & Other Carriages; Repairing of Motor Vehicle; Ship Building; Railway Equipment;
AircraftPaddy; Other grain; Food crops; Non-food crops; Livestock and poultry; Forestry; Fishery;
Crude petroleum and natural gas; Iron ore; Other metallic ore; Non-metallic ore and quarrying;
Electricity and gas water supply; Building construction; Other construction; Wholesale andTotal Industry
retail trade; Transportation; Telephone and telecommunication; Finance and insurance; Realestate; Education and research; Medical and health service; Restaurants; Hotel; Other
services; Unclassified; Public administration; Re-export
Milled grain and flour; Fish products; Slaughtering, meat products and dairy products; Other
food products; Beverage; Tobacco; Spinning; Weaving and dyeing; Knitting; Wearing
apparel; Other made-up textile products; Leather and leather products; Timber; Wooden
furniture; Other wooden products; Pulp and paper; Printing and publishing; Synthetic resins
Manufacturing: non-machinery and fiber; Basic industrial chemicals; Chemical fertilizers and pesticides; Drugs and medicine;
Other chemical products; Refined petroleum and its products; Plastic products; Tires andtubes; Other rubber products; Cement and cement products; Glass and glass products; Other
non-metallic mineral products; Iron and steel; Non-ferrous metal; Metal products; Other
manufacturing products
Boilers, engines and turbines; General machinery; Metal working machinery; Specializedmachinery; Heavy electrical equipment; Television sets, radios, audios and communicationequipment; Electronic computing equipment; Semiconductors and integrated circuits; Other
Manufacturing: machinery
electronics and electronic products; Household electrical equipment; Lighting fixtures,
batteries, wiring and others; Motor vehicles; Motor cycles; Shipbuilding; Other transport
equipment; Precision machines

Paddy; Other grain; Food crops; Non-food crops; Livestock and poultry; Forestry; Fishery;
Crude petroleum and natural gas; Iron ore; Other metallic ore; Non-metallic ore and quarrying;
Electricity and gas; Water supply; Building construction; Other construction; Wholesale andTotal Industry
retail trade; Transportation; Telephone and telecommunication; Finance and insurance; Realestate; Education and research; Medical and health service; Restaurants; Hotel; Other
services; Unclassified; Public administration; Re-export
Milled grain and flour; Fish products; Slaughtering, meat products and dairy products; Other
food products; Beverage; Tobacco; Spinning; Weaving and dyeing; Knitting; Wearing
apparel; Other made-up textile products: Leather and leather products; Timber; Wooden
furniture; Other wooden products; Pulp and paper; Printing and publishing; Synthetic resins
The Philippines
Manufacturing: non-machinery and fiber; Basic industrial chemicals; Chemical fertilizers and pesticides; Drugs and medicine;
Other chemical products; Refined petroleum and its products; Plastic products; Tires andtubes; Other rubber products; Cement and cement products; Glass and glass products; Other
non-metallic mineral products; Iron and steel; Non-ferrous metal; Metal products; Other
manufacturing products
Boilers, engines and turbines; General machinery; Metal working machinery; Specializedmachinery; Heavy electrical equipment; Television sets, radios, audios and communicationequipment; Electronic computing equipment; Semiconductors and integrated circuits; Other
Manufacturing: machinery
electronics and electronic products; Household electrical equipment; Lighting fixtures,
batteries, wiring and others; Motor vehicles; Motor cycles; Shipbuilding ; Other transport
equipment; Precision machines
Paddy (all kinds), Raw rubber, Coffee beans; Sugarcane; Tea; Other crops; Pig (All kinds); Cow(All kinds); Poultry; Other Livestock; Irrigation service; Other Agricultural services; Forestry;
Fishery; Fish – Farming; Coal; Metallic ore; Stone; Sand, Gravel; Other none-metallic minerals;
Electricity, gas; Water; Civil construction; Other construction; Trade; Repair of small transportmeans, motorbikes and personal household appliances; Hotels; Restaurants; Transportation;
Total Industry
Railway transport services; Water transport services; Air transport services; Communication
services; Tourism; Banking, credit, treasury; Lottery; Insurance; Science and technology; Realestate; Real estate business and consultancy services; State management, defense andcompulsory social security; Education and training; Health care, social relief; Culture and sport;
Association; Other services; Re-export /Re-import
Crude oil, natural gas (except exploration); Processed, preserved meat and by-products);
Processed vegetable, and animals oils and fats; Milk, butter and other dairy products; Cakes,
jams, candy, coca, chocolate products; Processed and preserved fruits and vegetables;
Alcohol, beer and liquors; Beer and liquors; Non-alcohol water and soft drinks; Sugar, refined;
Coffee, processed; Tea, processed; Cigarettes and other tobacco products; Processed seafood
and by products; Rice, processed; Other food manufactures; Glass and glass products;
VietnamCeramic and by products; Bricks, tiles; Cement; Concrete, mortar and other cement products;
Other building materials; Paper pulp and paper products and by products; Processed wood andwood products; Basic organic chemicals; Basic in organic chemicals; Chemical fertilizer;
Manufacturing: non-machinery
Fertilizer; Pesticides; Veterinary; Health medicine; Processed rubber and by products; Soap,
detergents; Perfumes and other toilet preparation; Plastic (including semi-plastic products);
Other plastic products; Paint incl. varnish and other painting materials; Other chemical
products; Non-ferrous metals and products (except machinery equipment); Ferrous metals andproducts (except machinery equipment); Weaving of cloths (all kinds); Fibers, thread (allkinds); Ready -made clother, sheets (all kinds); Carpets; Weaving and embroidery of textile based goods (except carpets); Products of leather tanneries; Leather goods; Animal feeds;
Products of printing activities; Products of publishing house; Other physical goods; Gasoline,
lubricants (already refined)
Health instrument and apparatus; Precise and optics equipment, meter (all kinds); Home
appliances and its spare parts; Motor vehicles, motor bikes and spare parts; Bicycles and spare
Manufacturing: machineryparts; General -purpose machinery; Other general -purpose machinery; Other special -purpose
machinery; Automobiles: Other transport mean; Electrical machinery; Other electrical machineryand equipment; Machinery used for broadcasting, television and information activities
Agriculture; Fishing; Mining and Quarrying; Recycling; Electricity, Gas and Water;
Construction; Maintenance and Repair; Wholesale Trade; Retail Trade; Hotels andTotal Industry
Restaurants; Transport; Post and Telecommunications; Financial Intermediation and Business
Activities; Public Administration; Education; Health and Other Services; Private Households;
Cambodia
Others; Re-export & Re-import
Food & Beverages; Textiles and Wearing; Apparel; Wood and Paper; Petroleum; Chemical and
Manufacturing: non-machinery
Non-Metallic Mineral Products; Metal Products; Other Manufacturing
Manufacturing: machinery
Electrical and Machinery; Transport Equipment

Sources: UNCTAD-Eora database