CARIFORUM and UK EPA Study

less for the majority of the services sectors. However, foreign value added content represented a much higher component of the majority of the country’s manufacturing and other industrial related activities. Indeed, the study also finds that the UK’s global value chain participation showed above average forward linkages, but that there was below average backward linkages. This was particularly true for services, suggesting that there are not as many opportunities in the backend to provide inputs into the UK’s services economy, relative to what is available for exploitation in relation to both domestic consumption and export linkages abroad, suggesting that there are likely to be more opportunities for the retailing of UK services output than there are for participating in their production and supply. Finally, the study also suggests that, when looking at the source of inputs to and final consumers of UK exports, that the UK’s trading relationships with other trade partners are highly correlated with the standard concept of “gravity” in international economics. That is, that factors such as physical distance, institutional and cultural similarities as well as trade-related frictions, such as border measures, significantly influences the UK’s trading patterns, with the US, Germany and France playing a key role in both the supply of services to the UK and the end-use of UK’s gross services exports. In assessing the UK’s trade in value added services and the opportunities that are available to CARIFORUM countries, the analysis has revealed that the UK’s economy is not only largely services driven, but offer less opportunities for value chain participation by foreign services providers, such as those from CARIFORUM, for the production and supply of services at the back end, while there are greater potential synergies at the front-end through the distribution (e.g., retailing or re-export) of UK services output. In relative terms, however, the top five services based activities that offered the strongest margins for the participation of foreign services providers were Financial and Insurance activities, Publishing, Audiovisual and Broadcasting services, Transportation and Storage, Telecommunications and Construction services. i. Summary of UK Trade in Value Added Services and Opportunities for CARIFORUM

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