The World Turned Upside Down? by Unknown
Author:Unknown
Language: eng
Format: epub
Publisher: New York University Press
Published: 2018-02-26T16:00:00+00:00
Note: SOE=State-Owned Enterprise; FIE=Foreign-Invested Enterprise; POE=Privately-Owned Enterprise.
Source: Author’s Calculations from China’s Customs Statistics, 1995-2017.
But the majority of these exports by POEs remain in low-value sectors, such as clothing and cheap consumer goods. Figure 2 shows the enterprise types for the most dynamic and technologically advanced of Chinese exports, what China Customs classifies as ‘process with imported materials exports’. These exports are at the heart of China’s integration into the global value chains of the world’s top TNCs, and are at the low-end of final assembly with high-value imported components. For example, these exports include the iPhone, as Apple subcontracts other firms to coordinate the importation of various components produced in different countries to be assembled in China and then re-exported to the rest of the world. In 2017, these exports accounted for $679 billion, or about a third of all Chinese exports. Like China’s total exports, the share of SOEs has collapsed, while foreign firms drove the initial surge of these high value exports, reaching a staggering 80 per cent by 2003. What is more astonishing, however, is that the share of FIEs has not dipped below 80 per cent ever since – almost 15 years. The FIE share even recently increased, to 85-86 per cent since 2015. And as we can see, the majority of the FIE share consists of fully foreign-owned enterprises, at 65 per cent in 2017 – the highest so far in this 22-year period. By contrast, the Chinese POE share has struggled to surpass 10 per cent, with only a handful of overseas success stories such as Huawei and Lenovo (although the latter has declined in recent years, with Hewlett-Packard regaining the top spot for PC-maker). The dominance of foreign capital in China’s most technologically advanced exports is staggering, especially when considering that most observers continue to assume that Chinese exports are exported by Chinese firms.
Figure 2. Enterprise Type for China’s ‘Process with Imported Materials’ Exports, 1995-201
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The World Turned Upside Down? by Unknown(266)
