Chapter 15 analyses growth rates, capital formation and savings ratios. The chapter considers the manufacture of electronics, garments and footwear central to swift Southeast Asian growth.

Chapter 8 applies the theory of globalized state-led development to China. Chinese reformers, a group of policy-makers that led the transition from a planned to a market economy, have much in common with developmentalists elsewhere in terms of their embrace of the developmental canon and the use of state financial institutions to achieve their policy goals. As part of a wider process of policy learning and experimentation, reformers began to support the outward investments of national firms in 1979. Policy debates ensued regarding the merits of this policy leading to its uneven adoption. Once the policy debate was resolved, the state launched its Go Global policy in 2000 and leveraged state financial institutions to shape the foreign investments of Chinese firms to meet the goal of indigenous innovation. The chapter details how the resulting Chinese globalized state-led development model is distinctive in its form and scale.

The objective of this chapter is to consider the effect of terrorism on trade. We rely on the existing literature on trade and terrorism and primarily use perfectly competitive models of trade. First, we highlight how terrorism may affect trade by damaging resources and causing general equilibrium reallocations of factors of production. Second, we consider how these trade effects may be altered in the presence of optimal counterterrorism policy. Third, the chapter discusses how trade may affect intra-industry trade in varieties using a monopolistically competitive framework. Finally, we discuss some of the existing empirical literature that has focused on trade-terrorism and FDI-terrorism issues. A central message of our analysis is that while terrorism will likely raise costs and dampen economic activity, whether it will raise or reduce trade of a nation depends on how terrorism affects that nation’s resource reallocation, relative prices and real income level.

This chapter introduces and operationalizes the Economic Weight Index to measure China’s and the United States’s economic influence in Latin America and the Caribbean (LAC) from 2001 to 2020. The index, comprising trade, aid, investment, and loans data, reveals China’s dramatic rise in economic weight across all world regions, with LAC experiencing the most pronounced growth. Conversely, the US saw a significant contraction in its economic weight in LAC during this period. The analysis highlights regional variations, with South America experiencing the most substantial increase in Chinese economic weight and decrease in US influence. This quantitative approach provides a nuanced understanding of the shifting economic dynamics between China, the US, and LAC, laying the groundwork for exploring the causes and consequences of these changes.

This chapter empirically examines the factors behind China’s growing economic influence in Latin America and the Caribbean (LAC) from 2001 to 2020. It challenges conventional explanations focused on the commodity boom and ideological affinities, instead demonstrating that Chinese actors filled economic voids left by declining US presence. Using a novel metric of Chinese economic actors’ presence and econometric models, the analysis shows that decreased US economic weight significantly correlates with increased Chinese activity. The chapter also explores sectoral patterns of Chinese engagement and uses a conjoint experiment to reveal that LAC preferences for foreign investment are driven more by economic impact than investor nationality. These findings support the book’s central argument that China’s economic displacement of the US in LAC was primarily due to filling gaps left by US retrenchment, rather than deliberate Chinese strategy or inherent preference for Chinese goods.

This chapter delves into the firm-level dynamics within China’s IER amidst its ongoing energy transition and geopolitical shifts. It reviews relevant international business theories and analyzes the international business activities of Chinese energy firms. Using the OLI framework, the chapter examines how China’s energy transition and geopolitical changes impact the international operations of Chinese energy firms, illustrated through case studies.

This chapter develops the book’s main theoretical argument, positing that American economic hierarchy has generally enhanced property rights and state capacity in partner states over the past forty years. It traces the shift in United States’ economic priorities toward property rights promotion in the 1980s, driven by foreign direct investors and exporting firms. The chapter explores the mechanisms linking property rights to state capacity and discusses the contrasting effects of American security hierarchy. It also considers alternative explanations and potential scope conditions.

In 2018, baijiu giant Jiangsu Yanghe Distillery Co., Ltd. acquired 12.5% of one of the largest global wine conglomerates in Chile, VSPT Wine Group, for US$65 million. The transaction was the first of its kind in the South American country, in which a Chinese baijiu producer purchased a stake in a Chilean wine company. The transaction involved considerable strategic and business planning and the support of experienced legal and financial advisors. This case study first analyzes how a change in alcohol consumption habits in China was a critical factor for Yanghe in deciding to carry out the transaction and the rationale behind choosing a target from the “new wine world.” It then explores how the Chile-China Free Trade Agreement has increased the amount of wine exported to China and how Chilean wine is perceived as “value for money” among Chinese consumers. Finally, it discusses how this transaction is an example of how Chinese state-owned enterprises have learned rapidly from their outward foreign direct investments and how Chinese investors are increasingly using experienced advisors to help inform their overseas investments.

This case study explores the State Grid Corporation of China’s (SGCC’s) localization strategies within the Belo Monte hydroelectric project in Brazil, highlighting the challenges and lessons learned by Chinese state-owned enterprises (SOEs) as they expand into Latin America. Over recent decades, Chinese SOEs have emerged as potential collaborators for Latin American countries seeking investment and technology for critical infrastructure projects. SGCC’s involvement in constructing the Xingu-Estreito transmission line for the Belo Monte project stands as a prime example. This line, among the world’s largest and first to implement ±800kV ultra-high-voltage technology outside China, marks not only an engineering triumph for SGCC but also a significant business and legal accomplishment. The company adeptly navigated Brazil’s complex legal environment, tackling multifaceted regulatory, financial, and environmental challenges. This case study, based on government and corporate documents as well as confidential interviews, examines SGCC’s strategies for procurement, financial structuring, environmental licensing, and operational management in the context of this grandiose transmission line.

Chapter Two focuses on the long-term effects of foreign direct investment at the subnational level in less developed peripheral regions. It identifies the different types and mechanisms of foreign direct investment in more developed (core) regions and less developed (peripheral) regions. It argues that positive long-term development effects of foreign direct investment in host regions depend on linkages between foreign-owned and domestic firms and spillovers from foreign-owned to domestic firms. It argues that in the long run, foreign direct investment tends to benefit core regions more than peripheral regions. Chapter Two also critically evaluates the most important conceptual approaches to foreign direct investment in peripheral regions developed in economic geography since the 1970s, namely the branch plant economy and truncation, new regionalism, new international division of labor and spatial divisions of labor, and the global production networks perspective.

Chapter Seven analyzes the progress of the transition from the production of vehicles with internal combustion engines to the production of electric vehicles in eastern Europe. The transition is considered in the context of the development of the automotive industry in eastern Europe since the early 1990s and the relative position of the east European integrated periphery in the European automotive industry value chains and production networks. The chapter argues that foreign firms are driving the transition, while the role of the east European governments and local firms is much less significant. The transition is slower than in western Europe, and eastern Europe will continue to produce internal combustion engine vehicles for longer. Eastern Europe will continue to rely on its competitive advantage of low production costs, especially low labor costs, to continue to attract foreign direct investment in the automotive industry. The chapter considers the consequences of the transition on the position of east European countries in automotive value chains, production networks and the division of labor in the European automotive industry.

Chapter Three examines the regional development effects of foreign direct investment in the integrated peripheries of the automotive industry by analyzing supplier linkages between foreign subsidiaries and domestic firms. It develops the spatial concept of integrated peripheries in core-based transnational production networks to explain the rapid growth of the automotive industry in Europe’s peripheral regions. Conceptually, it draws on the dynamic notion of uneven development in contemporary capitalism. Namely, it draws on the concept of spatiotemporal fix and on the global production networks concept of strategic coupling to investigate the mode of articulation of integrated peripheries into transnational macroregional production networks. Empirically, it analyzes the quantity and quality of supplier linkages in the automotive industry of Slovakia. The empirical analysis uncovered weak and dependent supplier linkages between foreign subsidiaries and domestic firms, which limits the potential for technology transfer and undermines potentially positive long-term regional development effects of large foreign direct investment by automotive industry corporations.

Chapter Eight summarizes basic points and arguments of the book and discusses its conceptual and methodological contribution to the global production networks and global value chains perspectives, and to the understanding of the changing geography of the contemporary European automotive industry. The topics include the long-term effects of foreign direct investment for economic development in less developed countries and in peripheral regions; the spatial concept of integrated peripheries and its application in the explanation of automotive industry’s gradual expansion from core to peripheral regions; the regional development effects of automotive foreign direct investment in integrated peripheries; the internationalization and restructuring of the European automotive industry; the core-periphery structure of the European automotive industry; value creation and value capture in the automotive industry; and the transition to the production of electric vehicles in eastern Europe.