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Global Sourcing Of Services: How Well Are The New Eu Member States Coping With The Challenges? (Part I)

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  • Ghibutiu, Agnes

    () (Institute for World Economy, Romanian Academy)

  • Poladian, Simona

    () (Institute for World Economy, Romanian Academy)

Abstract

increasingly drawn the attention of economists and politicians, as well as the public. Particularly in the light of the recent waves of EU enlargement these countries have been considered as highly attractive locations for offshored services both from a European and global perspective. While a fairly large amount of anecdotal evidence documents the NMS high potentialities in terms of service offshoring, academic research on this topic is limited. This paper aims to contribute to this discussion. Drawing on recent literature on the complex issue of service globalisation, the paper investigates NMS trade and FDI flows in services over the period 1995-2007 to find evidence of enhanced offshoring-related activities in these countries. The focus is on NMS-10, i.e. NMS-12 excluding Cyprus and Malta. Given the shortcomings of available statistical data and instruments for gauging the scale and impact of services offshoring, the paper adopts a three-tier approach based on BoP trade and FDI statistics, complemented by alternative sources of information. Notwithstanding the caveats associated with this kind of empirical exercise, the paper documents an accelerated pace of offshoring-related activities in the selected NMS, under both forms: international outsourcing and captive offshoring. Its findings show that the fast growing exports in some individual service categories in recent years, coupled with the favourable ongoing changes in the structure and performance of NMS services trade are largely driven by enhanced offshoring activities hosted by their economies. Further, the paper highlights the NMS capabilities to cope with the challenges raised by the increasingly competitive global offshoring landscape, as measured by competitiveness indicators. Finally, the findings of the paper confirm that current anecdotal information and consulting companies-based projections on NMS growing attractiveness as targets of offshoring decisions by TNC originating both inside and outside EU-15 are widely backed up by available statistical data. The paper is organised in two parts under the same title.

Suggested Citation

  • Ghibutiu, Agnes & Poladian, Simona, 2009. "Global Sourcing Of Services: How Well Are The New Eu Member States Coping With The Challenges? (Part I)," Journal for Economic Forecasting, Institute for Economic Forecasting, vol. 6(1), pages 123-135, March.
  • Handle: RePEc:rjr:romjef:v:6:y:2009:i:1:p:123-135
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    References listed on IDEAS

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    1. Dalia Marin, 2006. "A New International Division of Labor in Europe: Outsourcing and Offshoring to Eastern Europe," Journal of the European Economic Association, MIT Press, vol. 4(2-3), pages 612-622, 04-05.
    2. Gabor Hunya & Magdolna Sass, 2005. "Coming and Going: Gains and Losses from Relocations Affecting Hungary," wiiw Research Reports 323, The Vienna Institute for International Economic Studies, wiiw.
    3. Jacob Funk Kirkegaard, 2005. "Outsourcing and Offshoring: Pushing the European Model Over the Hill, Rather Than Off the Cliff!," Working Paper Series WP05-1, Peterson Institute for International Economics.
    4. Oecd, 2006. "Potential Impacts of International Sourcing on Different Occupation," OECD Digital Economy Papers 122, OECD Publishing.
    5. Mary Amiti & Shang-Jin Wei, 2004. "Fear of Service Outsourcing: Is It Justified?," NBER Working Papers 10808, National Bureau of Economic Research, Inc.
    6. Karel Havik & Kieran Mc Morrow, 2006. "Global trade integration and outsourcing : How well is the EU coping with the new challenges?," European Economy - Economic Papers 2008 - 2015 259, Directorate General Economic and Financial Affairs (DG ECFIN), European Commission.
    7. Oecd, 2006. "The Share of Employment Potentially Affected by Offshoring: An Empirical Investigation," OECD Digital Economy Papers 107, OECD Publishing.
    8. Mary Amiti & Shang-Jin Wei, 2005. "Fear of service outsourcing: is it justified?," Economic Policy, CEPR;CES;MSH, vol. 20(42), pages 308-347, April.
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    Cited by:

    1. Olimpia State & Daniel Bulin & Iulia Monica Oehler-Sincai & Adrian Lucian Kanovici & Maria Cristina Iorgulescu & Claudia Popescu & Delia Popescu, 2019. "Interpretation of Sustainable Development Using a Set of Macroeconomic and Social Indicators for a Group of Nine Emerging Economies," Sustainability, MDPI, Open Access Journal, vol. 11(11), pages 1-23, May.
    2. Magdalena Myszkowska, 2014. "The Scale and Characteristics of Services Offshoring in the Visegrád Countries," Entrepreneurial Business and Economics Review, Centre for Strategic and International Entrepreneurship at the Cracow University of Economics., vol. 2(3), pages 33-46.

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    More about this item

    Keywords

    globalisation; services; international trade; FDI; New EU Member States;
    All these keywords.

    JEL classification:

    • F02 - International Economics - - General - - - International Economic Order and Integration
    • L80 - Industrial Organization - - Industry Studies: Services - - - General
    • O52 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Europe
    • O57 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Comparative Studies of Countries

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