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Surpluses and deficits in bilateral trade balance in value added terms are generally lower than those in gross terms, and that Japan's manufacturing sector played a central role in the production chains in the West Pacific, and the US contributed to the region by providing services in value added terms.
Trade in value added.
If trade costs in a TCE are lower, the value added from service will be higher.
The higher the proportion of processing trade exports, the lower the value added becomes.
This is particularly noticeable in food products; the share of food in the average consumers expenditure, in the order of 20 percent in high-income economies and 40 to 60 percent in medium- and low-income countries, compares with shares that are several times lower for the value added of agriculture in GDP.
Surpluses and deficits in bilateral trade balance in value-added terms are generally lower than those in gross terms in absolute values, significantly so in some cases; Asia 7's surplus with China and Japan's surplus with Asia 7 were markedly lower in value-added terms than in gross terms.
% of value added in tradable sectors Eurostat Gross value added in agriculture and manufacturing over total gross value added.
The tax rate is therefore significantly lower than in Metropolitan Norway, including the absence of value added tax.
In their conclusions, the authors document that, in general, lower tariffs lead to higher value added in manufacturing through higher imports of inputs in the production process that were nonexistent in the domestic market, or were more expensive than in the international market.
Lower GDP shares of the value added in manufacturing have accompanied rising shares of employment in services (Figure 5). Figure 5 Global manufacturing and employment in services.
Lower import coefficients mean increased value added coefficients in this sector.
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