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There are solid theoretical grounds for an economy with growing technological capability to increase its high technology (high-tech) exports. The question that arises is whether the presence of high-tech exports also signifies technological capability. This paper examines the latter question in the context of the Association of Southeast Asian Nations (ASEAN) countries. Apart from Singapore, the Philippines and Malaysia have significant high-tech shares in manufacturing exports while Vietnam and Lao People’s Democratic Republic (Lao PDR) have also seen their high-tech export shares rise. Domestic indicators of technological capability, however, show, at best, modest but also stagnant technological capability. This disconnect is explained by the high proportion of electronics exports by these countries as participants of global supply chains. Since a lot of the technology-embodied contents of these exports are also imported, reference only to gross exports overstates the domestic technology embodied in these exports and also gives an exaggerated impression of the exporter’s technological capability. Opportunities, as well as challenges, exist in trying to bridge this gap.
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