Abstract
This paper adopts the GDYN model to estimate the dynamic impact of the COVID-19 pandemic on global manufacturing industry and the value chain. Our simulation finds that (1) In the short run, the low-tech manufacturing industries will suffer greater shocks, with a decline of output growth in 2021 by 6.0%. The growth rate of the high-tech manufacturing industry showed an increasing trend of 3.7% in 2021. (2) In the post-epidemic period, the total manufacturing output will return to the baseline level, from which the growth rate of low-tech manufacturing will rebound, demonstrating a V-shaped development trajectory. (3) From the perspective of Global Value Chain (GVC), the participation in GVCs of manufacturers in countries along the Belt and Road, the European Union and the United States will weaken, while China’s manufacturing industry has witnessed an obvious improvement in export competitiveness. The import added value of China has decreased, which shows that its ability to meet domestic demand has been improving. This indicates that the COVID-19 pandemic is providing a crucial opportunity for China to upgrade its manufacturing value chain, which contributes to the accelerated construction of a new dual-cycle development pattern.
Highlights
IntroductionThe COVID-19 epidemic continues to rage, putting humanity through a public health and economic crisis with far-reaching implications
Measuring and predicting the impact of the COVID-19 epidemic on the global manufacturing industry and its Value Chain is an important prerequisite for accurately dealing with the impact of the epidemic and building a new dual-cycle development pattern in the context of globalization
How will the Global Value Chain (GVC) structure of global manufacturing industry change in the long run? Will the changes be different for specific industries? As the world’s largest manufacturing center, what role will China play in the GVC trade? This study identifies the trade relationships between countries according to the source and destination of the value added trade and analyzes the trade between major countries/regions in the world after the epidemic subsides by constructing a social network structure diagram
Summary
The COVID-19 epidemic continues to rage, putting humanity through a public health and economic crisis with far-reaching implications. COVID-19 is already having far-ranging economic consequences, and the end is not yet in sight. Recent vaccine approvals have raised hopes of a turnaround in the pandemic later this year, renewed waves and new variants of the virus pose concerns for the outlook [7]. The cross-border flow of products and components is still greatly restricted worldwide, signifying a pessimistic outlook on the development trend of the global manufacturing value chain. Measuring and predicting the impact of the COVID-19 epidemic on the global manufacturing industry and its Value Chain is an important prerequisite for accurately dealing with the impact of the epidemic and building a new dual-cycle development pattern in the context of globalization
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