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Supporting participation of Asia-Pacific SMEs in global value chains

Masato Abe (United Nations Economic and Social Commission for Asia and the Pacific, Bangkok, Thailand)
Marc Proksch (United Nations Economic and Social Commission for Asia and the Pacific, Bangkok, Thailand)

Journal of Korea Trade

ISSN: 1229-828X

Publication date: 5 June 2017

Abstract

Purpose

Global value chains (GVCs) have become increasingly influential in determining the patterns of international trade and foreign direct investment (FDI) and in providing growth opportunities in Asia and the Pacific while small- and medium-sized enterprises (SMEs) have been an engine of economic development. The purpose of this paper is to provide effective development strategies and relevant policy approaches to facilitate dynamic insertion of SMEs into GVCs.

Design/methodology/approach

This paper was developed based on various Economic and Social Commission for Asia and the Pacific works in the fields of the development of SMEs and GVCs in Asia and the Pacific. Sectoral case studies on agribusiness, garment/apparel, automotive and electronics illustrate SMEs’ effective integration into GVCs.

Findings

SMEs face multiple obstacles and challenges which may limit the benefits derived from the development of GVCs in Asia and the Pacific. Policymakers are suggested to design and implement appropriate strategies and polices in order to facilitate the development of SMEs under the ongoing globalization.

Research limitations/implications

This paper is mainly based on existing policy papers which were developed by the United Nations Secretariat, its specialized agencies and others. Further empirical and policy studies are expected to be conducted in order to deepen the understanding of the present topics and to come up with practical policy options.

Practical implications

Policymakers are suggested to consider strategies and policy options recommended by this paper for their works on SME development and trade and investment promotion.

Originality/value

This is the first policy paper which proposes a comprehensive framework for SMEs’ effective participation in GVCs, specifically suggesting seven approaches, namely, SME development; trade policy; behind-the-border and cross-border trade facilitation; regional integration frameworks; FDI promotion; SME clusters; and national innovation system.

Keywords

Acknowledgements

An earlier version of this paper was presented at the 10th Inha-Le Havre International Conference on “International Trade, Capital Flows and Economic Development: Capacity Building and Economic Initiatives”, which was held at the Inha University, Incheon, the Republic of Korea, on 20 and 21 October 2016. The authors thank both Inha University and Le Havre University for their support. The authors also appreciate valuable comments made by Inkyo Cheong and Keon-Hyung Ahn as well as the participants in the conference and the anonymous reviewers. Panjai Limchupong and Candice Lea Marie Branchoux provided useful research assistance to the authors. The opinions expressed in this paper are those of the authors and do not necessarily reflect the views of the United Nations.

Citation

Abe, M. and Proksch, M. (2017), "Supporting participation of Asia-Pacific SMEs in global value chains", Journal of Korea Trade, Vol. 21 No. 2, pp. 86-106. https://doi.org/10.1108/JKT-12-2016-0047

Publisher

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Emerald Publishing Limited

Copyright © 2017, Korea Trade and Research Association