Beyond offshoring: Tradable services and regional value chains in the Global South

• Applicants: Professor Dr. Javier Revilla Diez; Dr. Sören Scholvin
• Subject Area: Human Geography
• Term: since 2022
• Project identifier: Deutsche Forschungsgemeinschaft (DFG) - Project number 505329997

Services generate more than half of global GDP. World service exports grew by 3.9 per cent per annum between 2008 and the Covid-19 pandemic, compared with 2.3 per cent for merchandise exports. Growing trade in services presents an opportunity for countries in the Global South to diversify their development strategies. Emerging nations may for the first time contribute significantly to the world's services industries. No longer relegated to manufacturing and natural resource-intensive industries, they now have an important opportunity to advance both their economic and social conditions.Unfortunately, the Global South is often portrayed in academic discourses as a passive recipient of growth impulses from Europe and North America. The internationalization of firms from developing countries and evidence that some progress into leaders in value chains have been neglected. Our project will show that there are endogenous dynamics of service exports across the Global South, with companies from countries such as Argentina, Singapore and South Africa venturing into foreign markets in banking, communications, information technologies and other sectors. They generate positive effects for these companies and the various places where they operate.The project will also make a contribution to research on regional value chains (RVCs), analysing whether – and if so, how – Southern service provides split their activities across various countries. Only initial efforts have been made to map RVCs. The conditions that lead to their rise need further investigation; so does their impact on firms – through upgrading – and the spreading of gains across various regional countries.RVCs are part of a broader academic debate to which this project will contribute. Global trade has become manifold and polycentric, with value chains oriented towards distinct end markets. Regionalization and trade among Southern economies are more and more important, complementing globalization and North–South trade. Research along these lines should concentrate on private and public governance of value chains behind the new trade, and on firm upgrading and regional development associated with it.

• DFG Programme: Research Grants
• International Connection: South Africa
• International Co-Applicants: Professor Dr. Ivan Turok; Dr. Justin Visagie