africa

Yale Center for the Study of Globalization
Figure 16.9: The “Pagoda” Effect: Impact On Value Addition in Africa When
Markets Shift to the South
Source: Author.
16.5 A new hope: The “double leap”
There is no guarantee that the opportunities will outweigh the risks, and that Africa
will be better off in the new economic order where GVCs rule international business
and trade relations—particularly if governments and donors continue to apply
old recipes to fix new problems, and disregard the changes in global trade and
development paradigms. For example, an excessive focus on industrialization
could lead to greater delays in the development process if emerging countries like
China continue to be competitive in the middle ground, blocking African economies’
upgrading prospects.
Diversification could take place within value chains. Figure 16.10 provides the
example of the fruit and vegetable value chain: African countries need to move from
the production stage to all the other stages of the chain to capture more value. In
most value chains, this means diversifying into services rather than industrial tasks.
Therefore, African countries need to undertake a “double leap:” a value-added leap,
moving into services within the sectors of traditional exports, and a technological
leap, developing the infrastructure necessary for such services.
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