BRAZILIAN ROLE IN THE GLOBAL VALUE CHAINS Joaquim J.M. Guilhoto Denise Imori Department of Economics University of São Paulo E-mail: guilhoto@usp.br - Internet: guilhotojjmg.wordpress.com Université Paris-Dauphine 27 th January 2014
AGENDA Introduction The Brazilian Economy Methodology Database Results Final Comments
INTRODUCTION
BRAZIL IN THE MAP 1
BRAZIL IN THE MAP 2
BRAZIL IN THE MAP 3
BRAZIL IN THE MAP 4
THE BRAZILIAN ECONOMY
SAVINGS & INVESTMENT
WORLD GDP
GDP DEVELOPING COUNTRIES
GDP - BRICS
BRAZIL MONTHLY INFLATION RATE 90 COLLOR I 80 70 MONTHLY INFLAÇÃO INFLATION MENSAL NO RATE BRASIL IPCA -IBGEIPCA - IBGE 60 50 REAL VERÃO 40 30 20 CRUZADO BRESSER COLLOR II 10 0-10 1980 01 1980 11 1981 09 1982 07 1983 05 1984 03 1985 01 1985 11 1986 09 1987 07 1988 05 1989 03 1990 01 1990 11 1991 09 1992 07 1993 05 1994 03 1995 01 1995 11 1996 09 1997 07 1998 05 1999 03 2000 01 2000 11 2001 09 2002 07 2003 05 2004 03 2005 01 2005 11 2006 09 2007 07 2008 05 2009 03
DEBT OF THE PUBLIC SECTOR 65,0% 55,0% 45,0% Dívida Total % of GDP DÍVIDA LÍQUIDA DO SETOR PÚBLICO (% DO PIB) 35,0% 25,0% Dívida Interna Internal 15,0% 5,0% External Dívida Externa -5,0% 1982 1989 jun/91 jan/92 ago/9 mar/9 out/93 mai/9 dez/9 jul/95 fev/96 set/96 abr/97 nov/9 jun/98 jan/99 ago/9 mar/0 out/00 mai/0 dez/0 jul/02 fev/03 set/03 abr/04 nov/0 jun/05 jan/06 ago/0 mar/0 out/07 mai/0 dez/0 jul/09-15,0%
TAX BURDEN 1 40% % of GDP CARGA TRIBUTÁRIA BRUTA NO BRASIL - % DO PIB 35,8% 35% 30% 25% 20% 15% 10% 1948 1950 1952 1954 1956 1958 1960 1962 1964 1966 1968 1970 1972 1974 1976 1978 1980 1982 1984 1986 1988 1990 1992 1994 1996 1998 2000 2002 2004 2006 2008
INTERNATIONAL RESERVES
THE MODEL (METHODOLOGY)
METHODOLOGY X BY The Leontief Model Trade in Value Added V WX V WBY WB G V GY rr rr r n r n rr r r rr rr r n r n y y y y G G G G v v v v 1 1 1 1 11 11 1 1 11 1 1 1 1 11 11
METHODOLOGY Trade in Value Added V GY r rr r r r Y Y G G G G V V 1 1 1 11 1 Global Value Chain (GCV) Participation Index, Koopman et al. (2011) ' 0 0 ' ˆ 1 Cr C C W W W E r E E 0 0 ˆ 1
METHODOLOGY Value added by source embodied in exports r rr Cr r Cr r r C C C E B W E B W E B W E B W BE W ' ' ' ' ˆ ˆ 1 1 1 1 1 11 1 Foreign value added that is embodied in a given country s exports (backward) j i j ij Ci j E B W FV ' Country s intermediate inputs that are embodied in the exports of other countries (forward) j i i ji Cj j E B W IV ' j j j j j E IV E FV Participation GVC _ Global Value Chain (GCV) Participation Index, Koopman et al. (2011)
THE DATA
THE DATA WIOD's series of world input-output table for the period of 1995-2011 IDE s BRICs international input-output table for 2005
THE RESULTS
BRAZIL IN GVC Exports and imports of value added, as % of total value added in the economy
BRAZIL IN GVC Exports and imports of value added, as % of total value added in the economy
BRAZIL IN GVC Value added footprints 1,10 1,05 1,00 0,95 0,90 0,85 0,80 Brazil China India Russia Japan EU25 U.S.A.
BRAZIL IN GVC GVC participation index, 2005
BRAZIL IN GVC GVC participation index, selected countries, 1995-2011 0,70 0,65 0,60 0,55 0,50 0,45 0,40 0,35 0,30 0,25 0,20 Brazil China India Russia Japan U.S.A.
BRAZIL IN GVC GVC participation index, Brazil, 1995-2011
BRIC S ECONOMIC INTERDEPENDENCE Countries Brazil China India Japan EU25 Russia U.S.A. 25 Sector classification Code Description Code Description 001 Agricultural products 014 Non-metallic mineral products 002 Livestock and poultry 015 Metals and metal products 003 Forestry 016 Industrial machinery 004 Fishery 017 Computers and electronic equipment 005 Crude petroleum and natural gas 018 Other electrical equipment 006 Other mining 019 Transport equipment 007 Food, beverage and tobacco 020 Other manufacturing products 008 Textile, leather, and the products thereof 021 Electricity, gas, and water supply 009 Wooden furniture and other wooden products 022 Construction 010 Pulp, paper and printing 023 Trade and transport 011 Chemical products 024 Other services 012 Petroleum and petro products 025 Public administration 013 Rubber products
BRIC S ECONOMIC INTERDEPENDENCE Value added multiplier effect, Brazilian industries
BRIC S ECONOMIC INTERDEPENDENCE Value added spillover effect per economy, Brazilian industries
BRIC S ECONOMIC INTERDEPENDENCE Final demand system (2005 US$, million) Brazil China India Russia Japan Brazil 755.727 5.040 986 2.667 3.076 China 3.578 1.608.166 6.023 6.784 63.472 India 743 4.503 647.691 687 2.554 Russia 773 7.801 2.075 495.004 4.083 Japan 2.705 45.623 2.855 4.756 3.873.046 EU25 13.968 41.760 17.807 47.793 42.159 U.S.A. 9.219 25.682 5.733 4.388 42.564 EU25 U.S.A. R.o.W. Total Brazil 23.164 19.100 51.533 861.292 China 131.887 139.913 295.855 2.255.679 India 19.658 15.578 45.051 736.466 Russia 85.392 13.278 108.213 716.620 Japan 81.269 111.923 268.674 4.390.851 EU25 11.030.568 241.152 708.785 12.143.993 U.S.A. 149.985 11.303.550 491.600 12.032.719
BRIC S ECONOMIC INTERDEPENDENCE Brazilian exports of value added (2005 US$, thousands)
BRIC S ECONOMIC INTERDEPENDENCE Sectoral composition of Brazilian exports of value added
BRIC S ECONOMIC INTERDEPENDENCE Destination of the industries value added
BRIC S ECONOMIC INTERDEPENDENCE Brazilian imports of value added (2005 US$, thousands)
BRIC S ECONOMIC INTERDEPENDENCE Sectoral composition of Brazilian imports of value added
BRIC S ECONOMIC INTERDEPENDENCE Bilateral trade balances (2005 US$, thousands)
FINAL COMMENTS
FINAL COMMENTS Brazilian trade in value added is quite limited compared to EU25 and to the other BRIC economies. In the period 1995-2011, however, it exhibited an increasing trend, following the global upsurge of trade in value added. Much of the Brazilian participation in the GVCs is due to its sourcing of intermediate inputs to other economies.
FINAL COMMENTS The spillover effects of high / medium-high technology industries of Brazil stand out, being mainly directed to the developed economies. The Brazilian trade in value added with China was largely based on metallurgical activities. Exports of agricultural products to China also embodied large figures of value added.
FINAL COMMENTS Chinese exports of value added to Brazil by some high / medium-high technology industries were expressive. In the case of India and Russia, the Brazilian exports of value added were largely generated in the low technology food industry, while the Brazilian imports of value added were notably related to petroleum and petro products.
FINAL COMMENTS The non-energy mining and the metallurgical industries value added in Brazil was generated in a large extend (more than 40%) to meet the final demand of foreign economies.
FINAL COMMENTS Merci! guilhoto@usp.br guilhotojjmg.wordpress.com