Indonesias Position on the GVC in the ASEAN Canada Region
Siti Miratul Khasanah (*), Dian Dwi Laksani, Nur Ulfa Mutiara Suwari
Trade Analysis and Development Agency, Ministry of Trade, Republic of Indonesia
*sitimiratulkhasanah[at]gmail.com
Abstract
Global Value Chain (GVC) is a useful tool to track shifting patterns of global production. To boost trade, an economic cooperation is proven helpful as it can increase added value trade within members. This study aims to analyze the position of Indonesia in the GVC in ASEAN-Canada region. The study used backward forward linkage indicators based on TiVA (Trade in Value Added) database. The study shows that within ASEAN, Indonesia has forward participation level equal to 0.3%. This number is equal to the Philippines but lower than Cambodia at about 0.4%. Indonesia is higher than other ASEAN countries average such as Malaysia, Thailand and Singapore at 0.2%. This implies that Indonesia is good in terms as supplier to Canada. Indonesia will be able to supply raw materials to Canada compared its ASEAN peers. This is supported by the facts that Indonesia is country graced with natural as well as human resources. Indonesia should continue to take active role on GVC to provide raw material for global products. In the future, Indonesia should be proactive as production based to be able to increase added value in becoming a forward country. Indeed it will positively impact Indonesias economy in a sustainable manner.
Keywords: ASEAN-Canada FTA; GVC; Added Value
Topic: Business Strategies on GVC Participation