Vice President, Research Institute of Economy, Trade and Industry (RIETI)
Deputy Director General for South and East Asia, Ministry of Foreign Affairs, Spain
Corporate Sustainability Transitions, Sustainable Investment, EU Taxonomy, GEODIS
Jong Woo Kang
Principal Economist, Economic Research and Regional Cooperation Department, Asian Development Bank
Bruegel was honoured to host a session at the inaugural Asia-Europe Economic and Business Forum, held in online from Phnom Penh, Cambodia on 24 November 2021.
There are a number of reasons why global value chains are being reshuffled. From increasing labor costs to environmental shocks, technological progress to geopolitics, all seem to be good reasons to rethink the location and functioning of global value chains.
One key issue is the uncertainty of international trade or global value chain, especially the Asia value chain. Efforts to reshuffle any specific critical components away from the original value chain, whether it is by the US, the EU, Japan, or others, could have a negative impact on Asia if such efforts lead to re-shoring back to their home economies. However, perhaps investors may prefer to nearshore in other geographies in Asia either to reduce costs and/or to better control the supply chain and avoid geopolitical risk.
Technological progress is also very important when determining the future geographical composition of the global value chain as well as the degree of vertical integration, the more so in countries pursuing more self-reliance.
- Has the Covid pandemic changed the geographical patterns of supply chains in Asia?
- How much more is expected and what are the main drivers?
- How can Asia ensure that a regional supply chain continues to develop and how to foster its resilience?
- How to minimize geopolitical risks?
Held as a side event to the ASEM13 and under the theme Transitioning to a New Normal: Leveraging Global Value Chains, Multilateralism and the 4IR, the AEEBF1 will serve as a new milestone to reinvigorate the inclusive growth of Asia and Europe as the world shifts into the so-called New Normal of the post-Covid-19 recovery.