Week5:Ch. 5 Developing a Global Vision

The Apple company’s basis and assemble materials overseas, which can make it hard to track a complex global supply chain. It also means that a product designed by a U.S. company but manufactured in China could be considered a Chinese export. For example, take the iphone, designed by the California-based company, Apple. According to the Wall Street Journal recently reported on findings from researchers at the Asian Development Bank that estimate the iPhone contributed $1.8 billion to U.S. trade deficit with China last year because technically, the iPhone is a Chinese export. The problem, according to the Wall   Street  researchers, is that the trade imbalances are determined through an outdated measurement system that doesn't really work for today's globalized economy. Traditional ways of measuring global trade produce the number other than fail to reflect the complexities of global commerce where the design manufacturing and assembly of products often involve several countries," they explain to The Wall Street Journal. According to the current measurement system, American products manufactured overseas can be categorized as U.S. import. The Wall Street Journal explains how Apple's iPhone’s current system gives China full credits for Apple Inc’s iphone Even some media agrees that the concept of country of origin as a way to measure exports has become "obsolete”. Those media adds that using a value-added approach would be more appropriate for today's globalized financial system.