Global Value Chain Participation and Current Account Balances in Landlocked African Countries

Main Article Content

Kenfack Geraud Francis
Ningaye Paul
Kuipou Toukam Christophe

Abstract

The objective of this paper is to find out the direction of Global Value Chain Participation (GVCP) that contribute more to the Current Account Balance (CAB) in landlocked African countries from 2000 to 2018. Our specification follows the IMF's External Balance Assessment (EBA) model. The Feasible Generalized Least Square (FGLS) econometric technique is applied on data from three sources: (1) UNCTAD-EORA database for forward and backward participation indicators, (2) World Development Indicator (WDI) data set, for current account balance, foreign direct investment (FDI), population and trade openness and (3) Penn World Tables (PWT) for exchange rates. Results highlight a positive and significant contribution of forward GVCP on CAB in landlocked African countries. The study recommends that landlocked African countries should be active providers of value-added intermediary inputs to other Global Value Chain actors.

Keywords:
Global Value Chain Participation (GVCP), current account balance, landlocked countries, Feasible Generalized Least Square (FGLS).

Article Details

How to Cite
Francis, K. G., Paul, N., & Christophe, K. T. (2020). Global Value Chain Participation and Current Account Balances in Landlocked African Countries. Journal of Economics, Management and Trade, 26(2), 1-14. https://doi.org/10.9734/jemt/2020/v26i230223
Section
Original Research Article

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