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HOW GVCS transforms the nature of trade policy and COMMERCE (Elements that…
HOW GVCS transforms the nature of trade policy and COMMERCE
Elements that facilitate or prevent GVCS PARTICIPATION
Not all companies and countries are equally involved in GVCs
Some countries participate in many and varied CMVs,
host country
to take to companies
or as a provider of very specific tasks
Government function
governments should foster environments that are friendly with the
production, investment, transport, communication and commerce
allow companies to take full advantage of their own
capabilities and those of its business partners
The impact of good governance on competitiveness can be illustrated with the case of capital expenditures in infrastructure
Some government interventions in the social field could help lift certain impediments to
developingcountry participation in CMV
Trade barriers
Trade policy per se may be less prominent in the global economy led by GVC than it did in past generations
This growing international fragmentation of
production has produced a “nexus of commercial services-know-how investment”
Capital movements and ideas
The demand for services to coordinate production
dispersed and distribution of goods and services
The development of ICT has also been an important factor in the appearance of CMV
High costs for companies
The coordination of activities
CGV reinforce the arguments against the already discredited mercantilist conception of commerce
Imports are essential for exports, especially in complex value chains
Transportation
Electronics
Tariffs and non-tariff barriers in the presence of CMVs are effectively an export tax,
Merchandise can cross borders many times in the process by which raw materials are transformed into finished products
While producers of goods in a protected economy may use instruments such as maquila operations
and rights refunds
A significant heterogeneity is also evident in the proportion of domestic value added incorporated in exports
A company that aspires to
Global competition has to be able to participate in delivery just in time, and have the flexibility to respond quickly to demand
They reduce the costs of trade and
coordination