Machinery Trade in East Asia, and the Global Financial Crisis
The global financial crisis since Q3 2008 has influenced the world economy, including that of East Asia. This paper focuses on international production/distribution networks, mainly observed in the machinery sectors in East Asia, and attempts to examine patterns of machinery trade movements during the crisis to explore how and to what extent it has affected trade. More specifically, the paper analyzes these trade patterns, with distinctions between machinery intermediate goods and machinery final products, among trading partners (regions), between intra-regional trade and inter-regional trade, and among machinery sectors, so as to investigate whether there were any differences in reactions to the crisis. Moreover, in order to consider possible seasonality in trade, the paper also attempts to apply the X-12 model and discusses features of trade patterns based not only on actual trade values but also on estimated trade values with seasonal adjustment. Our results demonstrate that effects of the global financial crisis on international production/distribution networks in East Asia do indeed exist but, at the same time, that East Asia’s trade has rapidly recovered through the regional production/distribution networks. In particular, East Asia itself is the major contributor to such a rapid recovery, not only for machinery parts and components trade but also for the machinery final goods trade. This suggests that the existence of dense production/distribution networks in East Asia helps industries to avoid becoming destabilized. It also suggests that East Asia is increasingly gaining importance not only as the production site but also as the consumption site for final products that are produced in the production/distribution networks in the region, implying that [further] activation and expansion of intra-regional demand are essential.
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- Kimura, Fukunari & Ando, Mitsuyo, 2005. "Two-dimensional fragmentation in East Asia: Conceptual framework and empirics," International Review of Economics & Finance, Elsevier, vol. 14(3), pages 317-348.
- Mitsuyo Ando & Fukunari Kimura, 2005.
"The Formation of International Production and Distribution Networks in East Asia,"
NBER Chapters,in: International Trade in East Asia, NBER-East Asia Seminar on Economics, Volume 14, pages 177-216
National Bureau of Economic Research, Inc.
- Mitsuyo Ando & Fukinari Kimura, 2003. "The Formation of International Production and Distribution Networks in East Asia," NBER Working Papers 10167, National Bureau of Economic Research, Inc.
- Ayako Obashi, 2011. "Resiliency of production networks in Asia: Evidence from the Asian crisis," STUDIES IN TRADE AND INVESTMENT,in: Trade-led growth: A sound strategy for Asia, chapter 3 United Nations Economic and Social Commission for Asia and the Pacific (ESCAP).
- Dr.Ayako OBASHI, 2009. "Resiliency of Production Networks in Asia: Evidence from the Asian Crisis," Working Papers DP-2009-21, Economic Research Institute for ASEAN and East Asia (ERIA).
- Ayako Obashi, 2009. "Resiliency of Production Networks in Asia: Evidence from the Asian Crisis," Keio/Kyoto Joint Global COE Discussion Paper Series 2009-005, Keio/Kyoto Joint Global COE Program.
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