Towards more (un)balanced trade. Production linkages between China and the Visegrad countries: country-level and sector-level analysis^*

* ‘The article is the result of the research project “Chinese New Silk Road strategy: implications for production linkages between China and Central and Eastern Europe” financed by the National Science Centre, Poland (UMO-2016/23/D/HS4/02748).’

ABSTRACT

This article presents the Visegrad Group member countries with special focus on the role of these countries in global value chains (GVCs). The goal of this paper is to analyse the role these states play in global production linkages and evaluation of connections between the VG states and China. We verified two hypotheses: (1) the Visegrad countries have deteriorated their positions in GVCs in relation to China recently; (2) the Visegrad states have become more dependent on Chinese value added in selected sectors. The analysis consists of two steps. Firstly, we evaluated the role of the Visegrad countries in international production linkages with China using value-added foreign trade using country-level approach. Secondly, we focused on the sectoral links between China and the Visegrad countries.

KEYWORDS:

• International trade
• global value chains
• Visegrad states
• China

JEL CLASSIFICATION:

• C1
• F1
• F5
• O1

Disclosure statement

No potential conflict of interest was reported by the author.

ORCID

Ewa Cieślik http://orcid.org/0000-0002-7230-8480

Notes

* ‘The article is the result of the research project “Chinese New Silk Road strategy: implications for production linkages between China and Central and Eastern Europe” financed by the National Science Centre, Poland (UMO-2016/23/D/HS4/02748).’

1 It will be developed in the next section.

2 In our study, we omitted tertiary industry due to limited data.

3 According to statistics, the largest share of CEE in China's FDI inflows to the whole continent in 2009–2017 was in 2011. In 2006–2015, Hungary with Bulgaria received the largest FDI (half of total inflows), followed by Poland (UNCTAD, 2019). Chinese motives, location choices and approach to labour force in selected VG states were well described in (Szunomar & McCaleb, 2018).

4 Where we could see the largest FVA and IVA flows.

5 It is worth to add that China has been upgrading its automotive sector by the domestic technological innovation capability and international linkages (Lu, Cheng, Chen, Ning, & Mei, 2015).

Additional information

Funding

This work was supported by the Narodowe Centrum Nauki (National Science Center), grant number UMO-2016/23/D/HS4/02748, “Chinese New Silk Road strategy: implications for production linkages between China and Central and Eastern Europe”.