Quality of Latin American and Caribbean industrialization and integration into the global economy

Mikio Kuwayama

Comercio Internacional from Naciones Unidas Comisión Económica para América Latina y el Caribe (CEPAL)

Abstract: Despite an increase in manufacturing activity in Latin America and the Caribbean, the growth in value-added generated by exports of manufactures has been disappointing in most cases. Developing Asia excels not only in the volume of trade in which the manufacturing sector serves as its primary driving force but also in the generation of manufacturing value added (MVA);. Irrespective of growing manufactured exports, the Latin American economies have not experienced the kind of dynamic restructuring of domestic production and export patterns that would allow investment to become an engine of growth. Export dynamism is almost always analyzed in gross export values, not in value-added terms. Value-added tends to be much lower particularly where developing countries are involved in low-skill, lowvalue added assembly stages of global production networks, as in electronics and apparels. The participation in the internationally integrated production systems that produce high-tech goods is not synonymous to the participation in high-technology production processes. Thus, participation in the labor-intensive segments of international production chains neither automatically brings about technology trade and technological upgrading and productivity growth as well as the technological spillovers needed to move up in the production chain. In order to harness trade as a driving force of growth not only for the manufacturing sector but also natural resource-based ones and services, Latin America and the Caribbean should adopt more proactive, forward-looking national policies, concurrent with the rapidly changing world marketplace, under a strong alliance between the public and private sectors.

Date: 2009-09
Note: Includes bibliography
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Citations: View citations in EconPapers (5)

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Persistent link: https://EconPapers.repec.org/RePEc:ecr:col025:4439

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