Global Journal of Management and Business Research, B: Economics and Commerce, Volume 23 Issue 1

Building Sustainable and Stable Global Value Chains: Case Study of Morocco Abdelmonim Amachraa α & Bertrand Quelin σ Author α: researcher at IAV Hassan 2 (Rabat), MSc in Geopolitics and Geoeconomics of Emerging Africa (HEC Paris – 2022) and hold an engineering degree from the Hassan II Agronomic and Veterinary Institute (2001). e-mail: abdelmonim.amachraa@ocpfoundation.org Author σ: Professor of Strategic Management at HEC Paris and holds the Bouygues HEC Paris Chair in ‘Smart City and the Common Good. Abstract- Global value chains (GVCs) are intended to fragment global production among several countries and companies. In this context, national economies have begun processes of insertion and specialization with both social and green objectives, because multinationals (MNEs) create significant negative externalities. As country, relies on a long-term political vision and some modern infrastructures even if Morocco has chosen to develop an integrated economy in global businesses. However, the GVCs face a tremendous change because the Covid-19 pandemic, war in Ukraine and shortages in value chains. In addition to these external shocks, MVCs face two internal mechanisms. First, the temptation of multinationals to reorganize their operations in a more regional manner. Second, the claim of many countries to produce and capture greater value added through their efforts to train people and develop ESG-based solutions. It is interesting to compare and analyze different types and levels of insertion of activities in GVCs. This paper examines four different cases in Morocco: phosphate, automotive, textile and agribusiness. We identify three trends. First, the government's strategic ambition to solve all problems, sometimes in a hurry, sometimes through a consistent policy of infrastructure provision. We identify a constant effort to prefer subsidizing local production to the emergence of strong and innovative local SMEs and locomotives. Second, we assess the ambition of some powerful multinationals in substituting, even partially, the role of government in key territories, and by deciding to achieve their short-term integration into the global economy. Third, all actors must address the challenges of ESG and sustainability investment. Keywords: global value chains, morocco, public and private governance, global and local stakeholders, SMEs rise, innovation. I. I ntroduction he Kingdom of Morocco, a major player in the international phosphate market, has succeeded in becoming a competitive hub in the automotive value chain linking Europe and Africa. A look at the performance of the Moroccan economy's integration in GVCs, including participation and position indices, shows how committed the country is to GVC development. However, Morocco's participation in some GVCs is still characterized today by low value added, poor upgrading, lack of innovation by SMEs (little risk- taking), few jobs for young people (market uncertainties, lack of growth prospects), and a strong dependence of the Moroccan economy on environmental conditions and the European market. As a result, Moroccan industry is trapped in certain low-value-added GVCs that hardly allow it to develop innovation and think about the 4th industrial revolution. We show that for a couple of industries, it is still difficult to take in hand the industrial, digital, social and environmental changes. The objectives of this research are to: 1. Rethink and develop an approach to integrate Morocco into GVCs and serve the socio-economic development of sites where GVCs are in line with the UN Sustainable Development Goals, 2. Reflect on relevant and innovative investment programs in the four GVCs analyzed, 3. Define the operational model for SMEs, multinationals and public authorities, and identify the new positioning of Morocco itself. II. G lobal V alue C hains - E mergence and E volution: A T heoretical B ackground GVC is the fragmentation of global production between several countries and companies advocating to invest in an ecosystem of suppliers. At the same time, it also promotes the transfer of technologies and good practices. Therefore, it is possible to produce in one place, consume in another, and control production and other segments of the value chain remotely and from another country. In this process, both countries and companies specialize in value-added tasks and functions without worrying about manufacturing an entire finished good. All countries participate in but in different wa ys depending on their comparative advantages 1 In this globalizing form, fragmentation (Jones and Kierzkowski,2001), offshore supply (Arndt, 1997), external orientation (Campa and Goldberg, 1997), production disintegration (Feenstra, 1998), sharing of world production (Yeats, 2001), vertical specialization . All actors must cope with new external and internal factors that can transform the existing GVC organization. 1 https://openknowledge.worldbank.org/handle/10986/3437 T 1 Global Journal of Management and Business Research Volume XXIII Issue I Version I Year 2023 ( ) B © 2023 Global Journals