China’s increasing participation in ICT’s global value chain: A firm level analysis

• Western companies continue to dominate the upper reaches of the ICT GVC.
• Nuanced and complex relationships between the Chinese state and foreign investors.
• China’s increased role in the ICT GVC closely related to the growth in outsourcing.
• Lack of technological progress by mainland companies from indigenous innovation.

This paper synthesises evidence from international trade data of China-based ICT companies in order to map their involvement in the ICT global value chain (GVC). The ICT GVC is divided into three types of companies: Own Brand Manufacturers (OBMs), component companies and Electronic Manufacturers (EMS)/Original Design Manufacturers (ODMs). The firm-level trade data provide us with a clear overall picture of the structure and relationships of the three types of companies, while identifying the key players. The evidence shows that China’s increasing participation in the ICT GVC is related to modularisation of product architecture, globalisation of production, and outsourcing and offshoring of manufacturing, and while several Chinese companies are rising rapidly, China continues to linger in the low value-added segments of the ICT GVC because of its ongoing dependence on foreign technology and its associated intellectual property (IP).