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Article
Mexico, Brazil and Chile : potential links with China and South Korea
Journal of Chinese Economic and Foreign Trade Studies
  • K. C. FUNG
  • Hsiang-Chih HWANG
  • Jesús SEADE, Lingnan University
  • Rocky YUNG
Document Type
Journal article
Publication Date
1-1-2016
Publisher
Emerald Group Publishing Limited
Keywords
  • China,
  • Brazil,
  • South Korea,
  • Mexico,
  • Chile,
  • Supply chains
Disciplines
Abstract
Purpose In this paper, the authors aim to examine trade in parts and components of Mexico, Chile and Brazil, focusing in particular on trade of television parts (SITC 7711) and semiconductors (SITC 7763) with China and South Korea. They also study the impact of foreign direct investment (FDI) on supply chain activities. Design/methodology/approach The authors use sub-categories of trade data to look at export and import of parts and components involving China, South Korea, Mexico, Brazil and Chile. They also use two-stage regressions to examine the impact of FDI on supply chain trade. Findings The authors found preliminary evidence that there may be early signs of an emerging Trans-Pacific production network between these three Latin American economies and the China-based and South Korea-based East Asian supply chains. The authors argue that this budding network will improve economic welfare. To deepen the Trans-Pacific supply chain, it would be desirable for China and South Korea to consider joining the Trans-Pacific Partnership (TPP). In addition, FDI enhances trade in components. Practical implications To deepen the Trans-Pacific supply chain, it would be desirable for China and South Korea to consider joining the TPP. In addition, it would be beneficial for these Latin American economies to encourage more direct investment in infrastructure and in manufacturing facilities from Asia. Originality/value This paper is one of the earliest research papers examining the Trans-Pacific supply chain, linking China, South Korea with Mexico, Brazil and Chile. The authors also study the impact of FDI on supply chain activities.
DOI
10.1108/JCEFTS-10-2016-033
E-ISSN
17544416
Publisher Statement
Copyright © Emerald Group Publishing Limited 2016. Access to external full text or publisher's version may require subscription.
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Citation Information
Fung, K. C., Hwang, H.-C., Seade, J., & Tung, R. (2016). Mexico, Brazil and Chile: Potential links with China and South Korea. Journal of Chinese Economic and Foreign Trade Studies, 9(3), 190-212. doi: 10.1108/JCEFTS-10-2016-033