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This paper assesses the implications for upgrading of integration into two distinct clothing value chains in Lesotho and Swaziland − the value chain characterised by Taiwanese investment and feeding into the US market under the African Growth and Opportunity Act (AGOA) and the value chain characterised by South African investment and feeding into the South African market. These value chains differ with regard to ownership patterns, end markets, governance structures, retailers' demands, and investors' motivations. These different characteristics have crucial impacts on upgrading possibilities, including functional, process and 'local' upgrading. Thus, from the perspective of upgrading and sustainability, ownership patterns, local embeddedness and market diversification matter. The emergence of South Africa as an alternative end market and the different value chain dynamics operating in the South African retailer-governed value chain opens up new opportunities from those of the AGOA/Taiwanese-dominated value chain.

This article examines whether low‐income countries can still benefit from participating in manufacturing global value chains (GVCs) in terms of broader industrial development in a global context of greater competition and higher requirements. It contends that developing internationally competitive local firms and domestic linkages, in addition to upgrading, is crucial for participation in GVCs to drive industrialization. The study focuses on Ethiopia's recent experience with developing an apparel export industry through strategic industrial policy. Based on original empirical data collected through firm‐level surveys and interviews with government officials, industry experts and buyers, the article analyses the upgrading and localization trajectories of foreign and local apparel‐exporting firms. It argues that value‐capture benefits in assembly positions in apparel GVCs have become more difficult. The potential for localization benefits depends on the type of global buyers and foreign producers and their levels of embeddedness, but whether this potential is realized also depends on local firm characteristics and related industrial policy. Ethiopia's industrial policy has been relatively successful regarding national economy linkages, but less successful in developing competitive local export firms due to a weak local manufacturing tradition combined with a global context that has led to a supplier squeeze.

Standard-Nutzungsbedingungen:Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden.Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen.Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, gelten abweichend von diesen Nutzungsbedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte. Terms of use: Documents in EconStor may Index of Tables AbstractThis paper shows the importance of ownership, end markets and regionalism within the global value chain (GVC) conceptual framework. This is done through unpacking the development trajectories of the major Sub Saharan African (SSA) apparel export industries (Mauritius, Madagascar, Kenya, Lesotho, Swaziland) against the backdrop of global and regional trade regime changes and the manner in which different supplier firms react to these opportunities and/or constraints. These trajectories demonstrate the emergence of a new regionalism centred around investment and differentiated end markets. Ownership characteristics of supplier firms shape the ability to shift between different end markets and respond to lead firm requirements; and the level of their local and regional embeddedness impacts on different forms of upgrading. More locally and regionally embedded firms in these SSA countries have been able to shift with uneven success to new, and in particular regional, markets. In contrast, Asian-owned transnational producers remain focused on the US market with limited market opportunities and upgrading potential. Different types of ownership and embeddedness dynamics are therefore important to explain the co-evolution of highly differentiated value chain dynamics creating a variety of apparel industrialization trajectories in the apparel export industry in SSA.

Value chain interventions are increasingly used by donors in the context of private sector development. The paper develops a typology of such interventions, and presents the case of one multilateral lending institution â\u80\u93 the Inter-American Development Bank. It argues that interventions risk transforming into an empty label and that an understanding of core global value chain (GVC) concepts, such as power, governance, and rents, is necessary. Further, interventions need to consider different learning channels internal and external to GVCs and particularly the interaction of GVCs with local innovation systems, and the interactive and systemic nature of knowledge and learning. These dimensions have often been overlooked in actual policies and programs. The paper concludes that an improvement in the definition of main concepts and approaches derived from the critical tradition of the GVC literature and of learning and innovation concepts is urgently called for. This reinforces the need for a new generation of industrial policies

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Standard-Nutzungsbedingungen:Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden.Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen.Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, gelten abweichend von diesen Nutzungsbedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte.

No abstract