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Real Desperate Situation of Sandwich Theory and its Implication

Author Youn, Woojin Date 2015.01.19 Issue No 605

-The sandwich theory is emerging more as real desperate situation   due to the recent rapid chase of Chinese smartphone makers According to the comparison of global market share among Korea, China, the U.S. and Japan in terms of total export and the export of value added, Korea has been maintaining around 3% global market share.


-The result from assessing the level of export advancement using trade statistics, also indicates that  the gap between leaders including the U.S. and Japan, and followers like Korea and China is narrowed significantly. 


- The gap between the leaders and the followers is narrowed even in the comparative advantage product items based on HS 6 unit, while the gap between Korea and China is shortened at the same time. 


- However, Korea’s contribution to global market is much lower in terms of the export of value added and the contribution rate of high value added export, than the contribution in terms of total export is.  


- Although Korea’s total export is 33% level to that of the U.S, its value added export and the contribution rate of Korea’s value added export remains only at 25% and 19% levels of those of U.S.


-For Korea to develop the export structure into value added export-oriented structure, it is necessary to convert to software-oriented policy from hardware-based policy.


- It is necessary for Korea to make more effort to develop into intermediate goods supply facility in the Asia value chain in which China is developing into global hub country