Front Matter Page
Western Hemisphere Department
Contents
I. Introduction
II. ASIA-LAC Trade Linkages and the Emergence of China
A. The Big Picture
B. LAC’s Exports to Asia
C. LAC’s Imports from Asia
D. Asia-LAC Third-Market Competition
III. The Long-Term Impact of China’s Rebalancing on LAC
A. Literature on Spillovers from China
B. A Model to Assess the Long-Run Effects of China’s Rebalancing
C. Data and Calibration
D. The Long-Term Impact of China’s Rebalacing
IV. The Impact of China’s Rebalancing on Lac’s Competitive Landscape: A Missed Opportunity?
A. Chinese Competition in Third Markets
B. Trade Competition Index
C. Data
D. Results
V. Reaping the Benefits of China’s Rebalancing
A. Deeper Integration
B. Other Policies
VI. The Amplifying Effect of the COVID-19 Pandemic
Diversification of global value chains
Decline in services involving high degree of person-to-person interaction
VII. Conclusions
Figures
Figure 1. LAC Exports/Imports/Trade-balance to/from/with Asia, 1998–2017
Figure 2. Geographical Distribution of LAC Exports and Imports, selected years
Figure 3. LAC’s Top-six Export Products to Asia by Origin and Destination, 2017
Figure 4. LAC’s Top-six Export Products to Asia by Origin and Destination, 2002
Figure 5. LAC’s Exports Dependency from Asia, 1997–2017
Figure 6. LAC’s Top-six Import Products from Asia by Origin and Destination, 2017
Figure 7. LAC’s Top-six Import Products from Asia by Origin and Destination, 2002
Figure 8. Export Competition between LAC and Asia in North America
Figure 9. China’s Rebalancing: Two Developments
Figure 10. Calibration of the “preference shock”
Figure 11. Calibration of the “production shock”
Figure 12. Effect of China’s rebalancing
Figure 13. Sectoral reallocation in China and LAC
Figure 14. Effect of China’s rebalancing on the composition of LAC’s real exports
Figure 15. Effect of China Rebalancing on Real GDP in LAC: Commodity and Non-Commodity Exporters (in percent)
Figure 16. Adjustment Cost to China Rebalancing in LAC: Commodity and Non-Commodity Exporters (in percent)
Figure 17. LA6: Top Competitors in 2015, based on VBI
Figure 18. LA6: Competition over time, based on VBI
Figure 19. LA6: Competition over time, based on VBI
Figure 20. LA6: Competition in Top 10 Product Lines, based on VBI
Figure 21. LAC: Trade Barriers
Figure 22. Impact on trade of LAC’s liberalization
Figure 23. Impact of LAC’s liberalization by country
Figure 24. Effect of China’s rebalancing on real GDP with/without LAC’s liberalization
Figure 25. Effect of China’s rebalancing on real exports with/without LAC’s liberalization
Tables
Table 1. Economic sectors included in the analysis
Appendixes
Appendix I: Calibration of the Shocks Using Brazil as Benchmark
Appendix III: Separating Demand and Production Shocks