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Examining the Bilateral Relationship between Mexico and South Korea through the Trade in Value-Added Perspective, 2000–2021

Author

Listed:
  • Rodrigo Morales-López

    (Department of Economics, Facultad de Estudios Superiores Acatlán UNAM, Naucalpan de Juárez 53150, Mexico)

  • Luis Quintana-Romero

    (Department of Economics, Facultad de Estudios Superiores Acatlán UNAM, Naucalpan de Juárez 53150, Mexico)

  • Nam Kwon Mun

    (Department of Latin American Studies, Graduate School of International and Area Studies, Hankuk University of Foreign Studies, Seoul 02450, Republic of Korea)

  • Inhye Oh

    (Department of Latin American Studies, Graduate School of International and Area Studies, Hankuk University of Foreign Studies, Seoul 02450, Republic of Korea)

Abstract

This article examines the trade relationship between Mexico and South Korea through the lens of trade in value-added perspective. Using the global input–output model, we dissect gross exports into their value-added components to analyze the sectors benefiting most from value-added generation in both countries. To do this, we use the multiregional input–output matrices developed by the Asian Development Bank (ADB). The results show a growing bilateral relationship between 2000 and 2021, with South Korea having a stronger position by generating a larger share of value-added linked to the bilateral relationship. Nevertheless, the gap has narrowed over time. Notably, South Korean exports to Mexico have substantially contributed to value-added generation in technology-based manufacturing sectors such as machinery, equipment, electronics, electrical, and optical products. Similarly, Mexico’s mining sector increasingly relies on exports to South Korea for value-added generation. The trends observed in this study’s findings persist even amidst the reconfiguration of Global Value Chains, indicating that a free trade agreement between Mexico and South Korea has the potential to further enhance value-added generation.

Suggested Citation

  • Rodrigo Morales-López & Luis Quintana-Romero & Nam Kwon Mun & Inhye Oh, 2023. "Examining the Bilateral Relationship between Mexico and South Korea through the Trade in Value-Added Perspective, 2000–2021," Mathematics, MDPI, vol. 11(15), pages 1-24, July.
    • Handle: RePEc:gam:jmathe:v:11:y:2023:i:15:p:3352-:d:1207298
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    References listed on IDEAS

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