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The rise of China’s manufacturing sector : challenges and opportunities for ASEAN-5


  • Mahendhiran Nair

    (School of Business, Monash University Sunway Campus, Selangor, Malaysia)

  • Deviga Vengedasalam

    (School of Business, Monash University Sunway Campus, Selangor, Malaysia)

  • Karunagaran Madhavan

    (Universiti Teknologi MARA, Malaysia)

  • V.G.R. Chandran Govindaraju

    (Universiti Teknologi MARA, Malaysia)


This study investigates the trends of manufacturing export from China and ASEAN-5 (Indonesia, Malaysia, Philippines, Thailand, and Singapore). The Balassa revealed comparative advantage (RCA) method was used to study the trade flows from these nations. The strength of the export specialization of the countries was measured using the Spearman’s rank correlation coefficient. The study was conducted using the Standard International Trade Classification (SITC) product categories at three-digit level for the period 1993-2004. The results showed that China is not only active in labor and resource-based industries, but is also moving up in the innovation value chain—that is, it is increasing its presence in technology and knowledge-intensive industries as well. The dual-strategy adopted by China has serious implications on the manufacturing industries in ASEAN-5. The paper discusses the strategies and policies to enhance the competitiveness of the manufacturing sector in ASEAN-5.

Suggested Citation

  • Mahendhiran Nair & Deviga Vengedasalam & Karunagaran Madhavan & V.G.R. Chandran Govindaraju, 2006. "The rise of China’s manufacturing sector : challenges and opportunities for ASEAN-5," Philippine Review of Economics, University of the Philippines School of Economics and Philippine Economic Society, vol. 43(1), pages 167-203, June.
  • Handle: RePEc:phs:prejrn:v:43:y:2006:i:1:p:167-203

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    manufacturing sector; competitiveness; ASEAN-5 and China;

    JEL classification:

    • F14 - International Economics - - Trade - - - Empirical Studies of Trade
    • L60 - Industrial Organization - - Industry Studies: Manufacturing - - - General
    • N60 - Economic History - - Manufacturing and Construction - - - General, International, or Comparative
    • N65 - Economic History - - Manufacturing and Construction - - - Asia including Middle East


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