European Manufacturing in Global Value Chains: Strengthening Integration and Undermining Competitiveness

Толкачев С.А.,Тепляков А.Ю.

Abstract

The article deals with the structural problems of the manufacturing industry in the EU member states. The study is based on the latest update of the TiVA statistical database «Trade in Value Added», which systematizes information on the global dynamics of global value chain (GVC) indicators. The article establishes that the European manufacturing industry as a whole is losing its competitiveness as a share of global manufacturing value added. At the same time, the new EU countries from Central, Eastern, and partly Southern Europe have managed to improve their position in global manufacturing value chains and even in high-tech industries by hosting production facilities from Western European countries. Examples of the success of the new industrialization of countries such as Slovakia and Ireland are considered. Analysis shows that the preservation of the country's own currency within the EU has a more positive effect on the state of the manufacturing industry. A correlation analysis of forward and backward linkages indicators in GVCs with the indicators of the country’s share of manufacturing growth in the global industry proves that the new EU members were able to benefit from both outsourced import supplies and their own export supplies. At the same time, this regrouping of industry within the EU does not strengthen the industrial and scientific and technical potential of the region as a whole.

Keywords

global value chains; manufacturing; industrial revolution; high-tech industries; economic integration; specialization.

DOI: 10.31249/rsm/2023.04.05

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