The Role of Global Production Networks in Indonesian Exports

Rudi Purwono and Lilik Sugiharti and Miguel Angel Esquivias Padilla and Rossanto Dwi Handoyo (2019) The Role of Global Production Networks in Indonesian Exports. International Journal of Innovative Technology and Exploring Engineering, 9 (2). pp. 4320-4330. ISSN 2278-3075

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Official URL: https://www.ijitee.org/portfolio-item/B7723129219/

Abstract

This study looks into Indonesia’s participation in fragmented structures within the Global Value Chain. By using a global input-output dataset and splitting gross exports into distinctive elements of value-added, the study measures vertical specialization of Indonesia against its four largest trading partners (NAFTA, East Asia, European Union and ASEAN) covering 29 countries for three periods: 1997, 2004 and 2012. Value-added is computed according to the initial source country and in the last destination. The paper also compares Indonesia to its ASEAN partners. The results show that Indonesia moved from exporting 50% of its value-added through finished products in 1997 to being a supplier of intermediates goods in 2012 (nearly 60% of its value-added). Foreign inputs in Indonesian exports account for 12%, a lower share versus ASEAN regional partners (35%) who are more vertically integrated. A total of 21% of Indonesian goods will be further exported to third countries. The degree of vertical integration in Indonesia in 2012 is 32.3%, up from 26% in 1997. Indonesia advanced in integration with East Asia and ASEAN countries (region), while it lowered its share of value-added traded with the North America and the Europe. Indonesia gained more than any other ASEAN partner in intra-regional trade.

Item Type: Article
Uncontrolled Keywords: ASEAN, Fragmented Networks, Trade in Value-added, Vertical Specialization, World Input Output.
Subjects: H Social Sciences
H Social Sciences > HB Economic Theory
H Social Sciences > HD Industries. Land use. Labor
H Social Sciences > HD Industries. Land use. Labor > HD8039 By industry or trade
Divisions: 04. Fakultas Ekonomi dan Bisnis > Doktoral Ilmu Ekonomi
04. Fakultas Ekonomi dan Bisnis > Magister Ilmu Ekonomi
Creators:
CreatorsNIM
Rudi PurwonoNIDN0003116902
Lilik SugihartiNIDN0025056804
Miguel Angel Esquivias PadillaUNSPECIFIED
Rossanto Dwi HandoyoNIDN0024087602
Depositing User: Tn Sugeng Riyanto
Date Deposited: 24 Aug 2022 00:19
Last Modified: 20 Apr 2023 09:58
URI: http://repository.unair.ac.id/id/eprint/117639
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