Services And Global Value Chains – Some Evidence On Servicification Of Manufacturing And Services Networks

This paper analyses the role of services in international trade through the lens of global value chains (GVCs). Services account for more than 70% of world GDP but only for around 20% of world trade in balance of payments terms. In value added terms, accounting for services embodied in exported goods, services account for 40% of world trade. However, the international supply of services is not only represented through cross-border transactions. Services are also traded through the movement of labour and capital. The latter contributes to the GDP of the domestic country. The services value added of foreign affiliates in selected EU countries account, on average, for a quarter of domestic services value added.