Global economy | Social challenges

Regional value chains in Africa for better global integration

10/06/2022 PNG

Regional value chains can help African countries accelerate productive transformation and recover sustainably from the COVID19 pandemic. African producers remain largely marginal actors in production both internationally (1.7% of participation in global value chains in 2019) and at the regional level. Regional value chains account for only 2.7% of Africa’s global value chain participation, compared to 26.4% in Latin America and the Caribbean and 42.9% in developing Asia.

Processed and semiprocessed goods accounted for 79% of intraAfrican exports in 2019, compared to 41% of Africa’s exports to other destinations. By moving away from exporting solely raw natural resources and agricultural commodities, Africa would increase its backward participation in global value chains, resulting in the creation of more productive jobs. For example, in the agri-food value chains, the non-farm jobs created can generate up to eight times more output than farming.

By strengthening its regional value chains, Africa could increase its capabilities and inputs and produce leading African firms able to enter and thrive in more demanding markets.

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