Integration of Regions in Global Value Chains

Trade in Value Added (TiVA) statistics show how countries participate in GVCs, but comparable evidence for regions remains scarce. National indicators cannot show how value chains link regions within a country. This project addresses this gap by measuring GVC integration at the subnational level.

Regions participate in GVCs directly when they export intermediate or final goods and services abroad, or use imported intermediate inputs in their own production. They can also participate indirectly by supplying intermediate inputs to other regions of the same country that are subsequently exported, or source inputs from other regions that embody foreign value added. Measuring both shows how domestic and global value chains are linked and how much value added each region generates through them.

The project also examines the role of subnational foreign direct investment (FDI), an important channel through which multinational enterprises can connect local firms to international production networks.

The project has two components.

UK Regions in the Global Economy: The OECD, with the UK Department for Business, Innovation, Science and Trade (BIST) and the Office for National Statistics (ONS), develops the first subnational TiVA indicators for the United Kingdom. The indicators cover the 12 UK TL2 regions (equivalent to ITL1 regions), comprising the nine English regions and the devolved nations of Northern Ireland, Scotland and Wales. The indicators are based on new and experimental regional supply and use tables (SUTs) and input-output tables (IOTs). They draw on more than 30 data sources, combining firm-level microdata with official and experimental statistics. Integrating these tables into the OECD Inter-Country Input-Output (ICIO) tables makes it possible, for the first time, to measure UK regions' participation in domestic and global value chains within the same framework as the OECD TiVA database, covering 36 industries for the period 2017-21.

In a new phase of the project, the OECD estimates the jobs and associated income in UK regions that are sustained by exports and final demand from foreign countries and other UK regions. This work also extends the subnational TiVA indicators to 2022.

Measuring and understanding GVCs in EU Regions: The OECD, with the European Commission and the Joint Research Centre (JRC), analyses how regions in the EU27 integrate into global value chains and how foreign direct investment shapes this integration. The analysis builds on the JRC's multi-regional input-output tables (FIGARO-REG), the regional extension of the FIGARO inter-country tables, complemented by new subnational FDI data on greenfield investment and mergers and acquisitions (M&A).

UK Regions in the Global Economy

Two complementary working papers: 

• UK Regions in the Global Economy analyses how the 12 UK TL2 regions and their industries are connected through value chains with other UK regions and with other countries. 

• Measuring Global Value Chain Participation in UK Regions documents the methodology and data sources used to construct the experimental regional SUTs and IOTs for the United Kingdom.

Data and code for the subnational TiVA indicators for the United Kingdom, covering 2017-21 and aggregated to 36 industries.

NOTE: The data presented here are experimental and should not be treated as official statistics. They combine microdata and aggregate data sources to maximise comparability across the 12 UK TL2 regions (equivalent to ITL1 regions) and integrate the regional tables into the OECD ICIO tables that underpin the TiVA indicators. The resulting indicators are internally consistent and comparable across regions. However, some may differ from official statistics, national TiVA estimates and other subnational data or analyses, including those produced by the ONS, the Northern Ireland Statistics and Research Agency (NISRA), the Scottish Government and the Welsh Government. The two papers set out the assumptions and limitations in detail.

Measuring and understanding GVCs in EU Regions

An OECD report that examines how regions in the EU27 integrate into GVCs and how FDI shapes this integration, drawing on new subnational FDI data that address gaps in harmonised regional data. The report analyses how FDI and GVC participation together shape regions' links to the global economy, and the conditions under which they can help local firms connect to international production networks and move into higher value-added activities.