Services In Manufacturing

Question 1

Services contribution to overall exports

If we are a service sector based economy, think about whether we’re good enough to export those services and if yes, how much of our exports are services and what are they?

Answer 1

1. 50% of our Gross Exports – Services (2011)
   v. v. high
2. In Gross Exports

– Business Support Services contribute more than traditional

– Computer services occupy a major share in Gross Exports but doesn’t really create value added (cuz they’re exported directly instead of adding to other items in exports)

– R&D contributes v low. Foreign companies high.

3. Domestic - 90% of all services. Computer, finance, distribution high domestic content.

Question 2

Services contribution to Manufacturing

Answer 2

1. ~35% services value added to Gross Manufacturing Exports
2. Foreign services content has been rising – means there are quality issues, competitiveness, and liberalization problems
3. Services contribution to Manufacturing exports is comparable to Manufacturing contribution to Manufacturing Exports

Eg. China