Global value chain and SME capability building: the role of private partnership for achieving SDGs in sub-Saharan Africa
Emmanuel Ejim-Eze (University of Port Harcourt)
Paper short abstract:
Global value chain (GVC) paradigm opened opportunities & challenges; with global production networks attracted by markets, resource-availability or efficiency/high productivity.This paper identified factors affecting integration of developing country SMEs into GVCs & recommended policy alternatives
Paper long abstract:
Global value chain (GVC) paradigm opened new opportunities and challenges. However Multinational companies (MNCs) that dominate GVCs are mainly resource-seeking; efficiency-seeking; or market-seeking. They tend to move to locations of interests and countries with high foreign direct investments potentials. These GVCs are less visible in developing countries. This study explored secondary data to identify factors affecting integration of SMEs in sub-Saharan Africa (SSA) into GVCs. It also investigated potentials of partnerships with the private sector (through SDG Goal 17; Partnerships for skill transfer, knowledge spillovers, resources sharing platforms, access to private sector assets, generation of shared value, e.t.c) to help develop local productive skills and build capabilities that will help reduce poverty and improve livelihoods of host communities. Results from the study show that factors such as infrastructure, supply of skilled labour, industrial development, institutional capacities, policies and business environment, e.t.c affect the location of GVCs. These factors also affect technology transfer, technology upgrading and integration of local SMEs to global production networks Evidence obtained from the study provided the basis for the policy recommendations made by the author. Factor endowments provide less competitive edge and economic relevant to today knowledge flows, speed and the dynamics of production. Business climate reforms, trade liberalization, skilled workforce and infrastructural supports are fundamental to improving competitiveness for both SMEs and MNCs. The paper recommended development of inclusive innovation systems in SSA that will attract private sector partnership for the improvement of industrial sector competitiveness and overall livelihood of people.
Integrating SMEs in global value chains and the challenge of inclusive development [paper]