Adding value in Global Value Chains

This paper compares alternative ways of measuring a country’s participation in Global Value Chains (GVCs) and estimates the distribution of total value added created under. Using the OECD-WTO database on Trade in Value Added, this paper shows that 67 per cent of total global value added created by trade under GVCs accrue to the OECD countries while the share of emerging economies (the NIEs and BRICS countries) is 25 per cent. Other developing countries account for only 8 per cent. The paper discusses external and internal constraints to adding value in GVCs by developing countries and identifies capacities that need to be developed by developing countries in order to gainfully link into GVCs.