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Journal of Economic Geography 1:299-321 (2001)
Copyright © 2001 Oxford University Press

Article

Organising regional production networks in Southeast Asia: implications for production fragmentation, trade, and rules of origin

Henry Wai-chung Yeung

Department of Geography, National University of Singapore, 1 Arts Link, Singapore 117570. geoywc{at}nus.edu.sg

Abstract

The globalisation of economic activities has fundamentally reshaped the relationships between production and trade. The cross-border production activities of transnational corporations (TNCs) have not only deepened spatial divisions of labour, but also complicated our understanding of international trade patterns. The development of intricate regional production networks by global corporations has major implications for production fragmentation, international trade, and rules of origin in the global economy. Empirically grounded in a study of regional production networks controlled by Singapore-based TNCs, this paper aims to make a modest contribution to the emerging literature on production fragmentation and rules of origin. Based on an analysis of empirical data from a survey of 63 parent Singapore-based manufacturing TNCs that have cross-border operations in Southeast Asia, I found that their spatial production fragmentation is rather limited. Most of their Southeast Asian subsidiaries cater to local markets, or manufacture components/parts for the regional production facilities of their major global corporation customers. I also consider the implications for business strategies and public policies in relation to production fragmentation and rules of origin in Southeast Asia.

Keywords: production fragmentation, networks, regional development, international trade

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