This paper analyzes the long-standing trade imbalance between Korea and Mexico based on the Global Value Chain (GVC) perspective comparing to gross exports. By decomposing gross exports into 16 value-added terms from
OECD Trade in Value-Added database, various features about the trade relation between Korea and Mexico are identified. First, it is reasonable for Mexico to be dissatisfied because Korea had never recorded a trade deficit in terms of the GVC from 1995 to 2018. Second, the value-added that Korea actually obtained from trade was smaller than in terms of gross exports. Third, Mexico benefited more in terms of efficiency of trade, as the share of value-added in gross exports was larger than Korea. Fourth, the manufacturing industry was the most influential factor that caused the overall trade imbalance, while the bilateral trade relation in the service sector was the most balanced. Finally, this paper provides implications that trade policies or strategies should be established considering not only gross exports, but also value-added terms.