Structural Transformation of Sub-Saharan African Economies: What Roles for Global Value Chains?

This paper examines the effect of integration into global value chains (GVCs) on the structural transformation of sub-Saharan African economies. Using a sample of 46 countries observed over the 1995–2018 period, we evaluate a panel-data cointegration model using the Fully Modified Ordinary Least Squares (FM-OLS) method. Overall, our results show that integration into GVCs contributes significantly to the structural transformation of the economies considered. However, this effect is counteracted by the low value added of exports. The results obtained remain globally stable when controlling for the different dimensions of participation in GVCs, but also for the specificities related to the African sub-regions. Moreover, they remain robust to changes in structural transformation indicators and to the use of competing estimators. We suggest improving the contribution of GVCs to structural transformation by taking into account and valuing exports with higher local added value.