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Journal of Economic Integration 2023 March;38(1) :59-92.
DOI: https://doi.org/10.11130/jei.2023.38.1.59
Trade Policy and African Participation in Global Value Chains: Does Trade Facilitation Matter?

Moukaila Mouzamilou Takpara1 Constant Fouopi Djiogap2 Bouraïma Sawadogo 1

1Pan-African University, Institute of Governance, Humanities and Social Sciences, Cameroon
2University of Yaoundé II, Cameroon
Corresponding Author: Moukaila Mouzamilou Takpara ,Email: takpara2025@gmail.com
Copyright ©2023 Journal of Economic Integration
ABSTRACT
This study offers an empirical appraisal of the contribution of trade facilitation for Sub-Saharan Africa (SSA) countries participation in global value chains. We used new value-added data on a panel of 25 countries over the period 2004-2017. The results using pooled ordinary least squares (OLS) regression and instrumental variable-two-stage least squares (IV-2SLS) estimators reveal that trade facilitation indicators such as physical infrastructure, information and communication technology, and border and transport efficiency support SSA countries' participation in global value chains. More interestingly, these results are robust at the sectoral level, particularly in agriculture, manufacturing, and textiles & clothing sectors for physical infrastructure and ICT, while the business environment is conducive to upstream integration of GVCs in the agriculture and textiles & clothing sectors. These results underscore the increased importance of trade facilitation in the era of global value chains and call for well-targeted sectoral policies to reap the benefits of GVCs.

JEL Classification
F13: Trade Policy; International Trade Organizations
F14: Empirical Studies of Trade
F15: Economic Integration
F23: Multinational Firms; International Business
Keywords: global value chains | trade policy | trade facilitation | Sub-Saharan Africa | two-stage least squares (IV-2SLS)
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