Future Fragmentation Processes: Effectively Engaging with the Ascendancy of Global Value Chains

Leveraging the power of trade to expand formal employment opportunities, generate greater value addition, assist diversification processes, and develop productive capabilities is an aspiration of all Commonwealth governments. These objectives were conveyed clearly at the Commonwealth Trade Ministers Meeting convened in March 2017. In order to engage effectively with contemporary trade, which manifests as global value chains (GVCs), it is incumbent on governments to better understand corporate strategies. The achievement of structural economic transformation within the context of GVC trade entails system-wide approaches, more cognizant of innovation systems, as opposed to more siloed approaches towards sectoral development. Concerted action is required to facilitate interactions between private and public agents so as to effectively enable societal upgrading processes. As well as taking stock of past performance, the essays included here reflect on potential dynamics and future fragmentation processes. The chapters provide for a more careful examination of GVCs at the sectoral level: manufacturing, services, and commodity trade. Given that the overwhelming majority of the 52 Commonwealth member countries are small states-45 are oceans states and around one-fifth are least developed countries-understanding how the dynamics are unfolding at the sectoral level is critical to encouraging more gainful GVC participation. Using the experiences across the Commonwealth of existing GVC participation, a clear set of policy measures becomes apparent. These include overcoming barriers to entry, informational asymmetries and unfair competition, and stimulating innovation. Finally, this title highlights important knowledge and data constraints for small states in the Pacific and Caribbean. [Subject: Economics, Public Policy, Oceanic Studies, Trade, Global Value Chains]