Integration of African firms into global value chains: A comparison of Finnish and Chinese firms’ sourcing from Africa
Critical Perspectives on International Business
ISSN: 1742-2043
Article publication date: 4 December 2017
Issue publication date: 30 May 2018
Abstract
Purpose
This paper aims to analyze the roles that African suppliers play in global value chains and the strategies that foreign firms adopt to integrate African firms into their supply chains.
Design/methodology/approach
The empirical research of this paper is based on a multiple case study and on interview data of foreign buyers and their entry into African supply markets: five Finnish companies and five Chinese companies were interviewed in 2014-2015.
Findings
The authors find that Finnish firms make relatively small investments and start sourcing operations on a small scale, whereas Chinese firms are running large infrastructural projects, relying on local sourcing. African firms typically only play modest roles with little value capture in the chain, supplying raw materials and simple products. The African infrastructural and cultural context makes it challenging for foreign firms to provide local suppliers with more strategic roles in their chains, thus hindering integration of local firms into global value chains.
Originality/value
This paper is one of the first to offer a comparison of Finnish (Western) and Chinese (other emerging economy) firms’ sourcing from Africa and provides understanding of the role of African suppliers in current value chains. The authors offer a qualitative exploration of why companies invest in African suppliers and of the scope of African presence in global value chains.
Keywords
Citation
You, W., Salmi, A. and Kauppi, K. (2018), "Integration of African firms into global value chains: A comparison of Finnish and Chinese firms’ sourcing from Africa", Critical Perspectives on International Business, Vol. 14 No. 2/3, pp. 252-281. https://doi.org/10.1108/cpoib-11-2016-0056
Publisher
:Emerald Publishing Limited
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