LSE - Small Logo
LSE - Small Logo

Shamel Azmeh

May 28th, 2020

Mediterranean Production Networks and the Export Economies of North Africa

0 comments | 1 shares

Estimated reading time: 5 minutes

Shamel Azmeh

May 28th, 2020

Mediterranean Production Networks and the Export Economies of North Africa

0 comments | 1 shares

Estimated reading time: 5 minutes

by Shamel Azmeh

Textile stalls in Marrakech, 2007. Source: Jared Kelly, Flickr

This blog series is one of the outputs from a workshop held at the LSE Middle East Centre in January 2020. The workshop was part of a project funded by the Centre on the production networks and value chains linking North Africa with Europe. Over the past three years, myself and my co-investigator Abeer Elshennawi, from the American University in Cairo (AUC), have been researching export industries in Morocco, Egypt and Tunisia. In recent decades, those three countries have emerged as important export platforms for European firms and Europe-focused global value chains as labour-intensive activities in industries such as apparel, electronics and automotive were relocated across the Mediterranean to industrial zones in Tunisia, Egypt and Morocco. As a location for labour-intensive industries, those countries offered a number of advantages to European firms. First, the proximity to Europe and the good logistical networks between those countries and Europe meant that costs of shipping and time-to-market from those industrial areas to Europe were low. Secondly, aiming to attract European investments, governments in the three countries offered a range of incentives to attract foreign investments including tax holidays. Thirdly, the three countries became increasingly integrated in the European economy through association and free trade agreements with the EU and through effort, albeit unsuccessful so far, to reach new generation trade agreements with the EU; the so-called Deep and Comprehensive Free Trade Agreements (DCFTAs). Overall, those economies appeared to be in a prime position to benefit from the growing offshoring of European production over the last few decades in order to drive export-oriented industrialisation and development process; a strategy that many other developing countries continue to pursue.

Our research project aimed to analyse this process and to understand the outcomes of this development strategy in North Africa. The results we reached show mixed outcomes of this strategy (and will be detailed in a soon-to-be-released working paper from the MEC). On the one hand, examining the macroeconomic structure of those economies, we found that those countries have succeeded in achieving a degree of structural change in their position in the global economy particularly a shift in their exports toward manufactured exports. This has helped these economies create jobs in the export industry and also to enter more advanced economic sectors such as electronics and automotive. On the other hand, however, the position of those economies in the production networks of the European market remains fragile. Activities with high value-added remain largely concentrated in Europe with limited success by the North African economies achieve economic upgrading in these value chains. As a result, the position of these economies in European production networks remains peripheral and subject to changes by both European lead firms and changes by the macro policies of the EU such as trade policies.

The aim of the workshop that was held in LSE was to discuss some of these issues in North Africa and beyond. As such, we invited scholars working not only on North Africa but also on similar themes in other parts of the world. We asked participants to submit a short blog on one area of their work. This blog series consist of those submissions.


In this series:

Print Friendly, PDF & Email

About the author

Shamel Azmeh

Shamel Azmeh is a Lecturer at the University of Manchester, focusing on international political economy, digital economy, labour, the Middle East & North Africa, and trade. He was a Visiting Fellow at the Middle East Centre from 2017–20. He tweets at @shamelazmeh

Posted In: Conferences | North Africa

Leave a Reply

Your email address will not be published. Required fields are marked *

Bad Behavior has blocked 1579 access attempts in the last 7 days.