Perspectives from Spatial and Neoclassical Economics
Edited by Masahisa Fujita, Satoru Kumagai and Koji Nishikimi
Chapter 4: Industrial Clustering and MNE Management in East Asia: Recent Progress and Prospects for the Asian Triangle
4. Industrial clustering and MNE management in East Asia: recent progress and prospects for the Asian Triangle Akifumi Kuchiki INTRODUCTION 4.1 A growing number of industrial clusters have emerged in East Asia in the process of (de facto) economic integration. Multinational enterprises (MNEs) widely play a key role as anchor ﬁrms in forming industrial clusters and creating logistic links among them. These enterprises make signiﬁcant eﬀorts to organize their aﬃliated plants spread over Asia into an intra-ﬁrm global production network and to manage the network as eﬃciently as possible (value chain management). In this chapter, we overview the development of industrial clusters in the growing economies of Asia and examine how Asian economies are being regionally integrated on the basis of fragmentation and value chain management by MNEs. Among all growing economies in East Asia, China, India and Vietnam, in particular, have been achieving remarkable economic growth. As shown in Table 4.1, their average GDP growth rates from 2000 to 2004 are as high as 8.5 percent (China), 5.8 percent (India) and 6.6 percent (Vietnam). These three economies are also expected to grow continuously into the latter half of the 2000s. Recently, the Global Strategy Research Institute of Matsushita Electric Industrial Co. Ltd has forecast that a triangle with boundaries formed by China, India and ASEAN, as shown in Figure 4.1, will be a prosperous manufacturing industry production site for the world market around 2030. We designate this area the Asian Triangle. Several highway networks...
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