Concentration in Trade in Services
Between Enterprises of the Same
Group
3rd Meeting of the WPTGS
OECD, Paris
October 4-6, 2010
Fernando Lemos
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Introduction
In the 2nd WPTGS Meeting, in 2009, I delivered the
presentation Trade in Services Between Enterprises of
the Same Group which demonstrated that, in the
Brazilian balance of payments, “a very significant share
of services is rendered between enterprises of the same
group (intra-group), linked to a same transnational
corporation (TNC).”
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Introduction
The current presentation uses the same data set as the
2009 presentation to show that intra-group transactions,
which represent a significant share of total trade in
services, are carried out in their majority by a small
share of companies.
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Methodology
The assessment was conducted for selected services
in which intra-group trade is more frequently
encountered. It consisted of the analysis of all
transactions of these services between 2006 to 2008,
equal to or above US$100,000, that singled out intra-
group transactions.
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Methodology
In the analysis, intragroup transactions amounted to
approximately 37% of all expenditures and 55% of all
revenues in the >=US$ 100.000 transactions.
The 20%-80% rule of thumb was used as a paramater
to analyse the concentration in terms of the share of
companies responsible for the share of transactions,
measured in terms of values.
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Findings
A series of graphs is presented showing the degree of
concentration of transactions.
Regardless of the “size” or direction – outward or inward
- of the service, in all but one of the services shown the
20% share of companies exceeded 80% of the total
value of transactions.
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Findings
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Findings
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Findings
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Findings
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Findings
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Findings
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Findings
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Findings
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Findings
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Findings
For some services, but especially Architecture,
Engineering and Other Technical Services, revenues
are suprisingly high. But, as pointed out in last years’
presentation, they seem to represent services rendered
by resident affiliates on behalf of their non-resident
parent companies.
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Findings
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Final remarks
These data raise a few questions, among which:
Are the major forces driving the trade in services similar to those
driving trade in goods?
Should domestic policies related to trade in services and
international trade negotiations take into account the fact that a
“handful” of TNCs conduct a significant share of the international
trade?
How trustworthy are the intra-group data? How can they be
checked for accuracy?
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Thank you for your
attention.
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