African Firms in Global Value Chains: What Can We Learn from Firm-Level Data in Cameroon and Côte d'Ivoire?
African Economic Research Consortium
This scoping paper exploits information from a unique data set constructed by merging firm census and custom data sets from Cameroon and Côte d'Ivoire to analyse the characteristics of firms that participate in global value chains (GVCs) in sub-Saharan Africa. These “GVC firms” are defined as firms that both export and import, with positive production and labour. The paper provides a detailed review of the state of firms' participation in GVCs in Africa and its consequences on trade, employment, and growth. The evidence in Cameroon and Côte d'Ivoire suggests that, in line with literature on firm heterogeneity and trade, firms engaged in GVCs are larger, more productive, and live longer than one-way-traders or domestic firms. Surprisingly, however, there are more GVC firms than pure exporters, a sign of the challenges faced by firms in those countries if they want to sell abroad. The probability of moving into a GVC is higher for exporters than for importers, showing that exporting is a stepping stone for firms to join a GVC.
Global value chains; Firms and trade.