A Strategic Framework for Achieving Sustainability and Resilience in Global Supply Chains

In order to achieve sustainability and resilience at the same time in global supply chains, a strategic framework and ecosystem collaboration is required to orchestrate the activities of the different supply chain participants to achieve a common goal. While the necessity of ecosystems is understood and accepted, the successful implementation of those remains a challenge. This paper looks from the perspective of practitioners at this challenge, identifying the critical success factors to make a collaboration ecosystem work. Based on the analysis of existing strategy concepts, ESG frameworks and of several ecosystems, a strategy framework is developed that can serve as a blueprint to successfully create global value networks that balance sustainability and resilience concerns using data and analytics

A Strategic Framework for Achieving Sustainability and Resilience in Global Supply Chains

In order to achieve sustainability and resilience at the same time in global supply chains, a strategic framework and ecosystem collaboration is required to orchestrate the activities of the different supply chain participants to achieve a common goal. While the necessity of ecosystems is understood and accepted, the successful implementation of those remains a challenge. This paper looks from the perspective of practitioners at this challenge, identifying the critical success factors to make a collaboration ecosystem work. Based on the analysis of existing strategy concepts, ESG frameworks and of several ecosystems, a strategy framework is developed that can serve as a blueprint to successfully create global value networks that balance sustainability and resilience concerns using data and analytics

The opportunities and challenges of Industry 4.0 for industrial development: A case study of Morocco's automotive and garment sectors

The development and application of advanced manufacturing technologies (known as Industry 4.0) have been enabled by the fast-paced process of digital transformation. These transformations are expected to have major implications on the reorganisation of global value chains as well as on labour markets. For late-industrialising countries, Industry 4.0 brings both opportunities and challenges. On the one hand, it opens opportunities in terms of improving competitiveness, learning and export markets. On the other hand, however, it may devalue the traditional competitive advantage based on low labour costs, creating difficult-to-tackle challenges on labour markets related to unemployment and new demands for reskilling and upskilling. This paper explores these aspects through the lens of one country, Morocco, and two very different sectors: automotive and apparel. Morocco is a lower-middle-income country that has capitalised on its proximity to Europe and succeeded in developing a dynamic export-oriented automotive industry. The garment sector, which is critical for employment, has been generally neglected by the industrial development strategies. However, Industry 4.0 and its implications on global value chains are likely to affect both sectors, although in different ways. Our analysis clearly shows that interventions must be tailored to the different degrees of technological readiness. The automotive sector is driven more by the needs of major original equipment manufacturers. Therefore, industrial policy should focus on setting the framework conditions, enabling upgrading by investing in research and development, and shifting incentives towards facilitating local suppliers to better integrate with higher-tier suppliers. In the garment sector, policy interventions need to be more comprehensive, from developing a long-term vision to building awareness on technological upgrading and new business models enabled by digitalisation and automation. Moreover, there is extensive scope for industrial policy to contribute to building basic technological and knowledge capabilities all along the garment supply chain and to attracting investment

Industrial policy in Morocco and its potential contribution to a new social contract

Similar to other countries in North Africa, Morocco’s economic model finds itself at a crossroads. The uprisings and subsequent revolutions in many Arab countries in the wake of the 2011 “Arab Spring” have shown that the social contract prevailing in the Middle East and North Africa (MENA) has ultimately failed. Although to varying degrees, the states of the region find themselves in need of redefining their relationships with society and developing long-term strategies to better meet the demands of their constituents. We argue that industrial policy can provide a valuable contribution to establishing a new and better social contract by addressing economic problems, such as job creation and growth, as well as by paving new ways of collaboration between government, business and non-business actors, and thus higher inclusion. This, we argue, can be achieved if key criteria related to embedded autonomy, specifically extensive cooperation across stakeholders, as well as monitoring and evaluation of outcomes are fulfilled. Our findings suggest that the policy-making process in Morocco is becoming systemic in nature, values dialogue with the private sector, and places a stronger focus on industrialisation through dynamic competitive advantage, which might set it apart from other countries in the region. However, some hurdles still need to be appropriately addressed, most particularly to satisfy the second criteria of monitoring and evaluation, which still exhibits major shortcomings, but also concerning deeper inclusion and a more systematic implementation. Yet, although challenges remain, Morocco has taken a promising direction towards addressing the weaknesses of previous policies. If the identified weaknesses are addressed, industrial policy might well prove itself as valuable contribution to a new social contract within the country

Subsidy Reform and the Transformation of Social Contracts: The Cases of Egypt, Iran and Morocco

After independence, subsidies have been a cornerstone of the social contracts in the Middle East and North Africa. Governments spent heavily to reduce poverty and strengthen their legitimacy. Yet, subsidies became financially unsustainable and donors pressed for reforms. This article assesses reform processes in Morocco, Egypt and Iran between 2010 and 2017, thus before sanctions against Iran were further tightened and before the COVID-19 pandemic. We show that even though the three countries had similar approaches to subsidisation, they have used distinct strategies to reduce subsidies and minimise social unrest—with the effect that their respective social contracts developed differently. Morocco tried to preserve its social contract as much as possible; it removed most subsidies, explained the need for reform, engaged in societal dialogue and implemented some compensatory measures, preserving most of its prevailing social contract. Egypt, in contrast, dismantled subsidy schemes more radically, without systematic information and consultation campaigns and offered limited compensation. By using repression and a narrative of collective security, the government transformed the social contract from a provision to a protection pact. Iran replaced subsidies with a more cost-efficient and egalitarian quasi-universal cash transfer scheme, paving the way to a more inclusive social contract. We conclude that the approach that governments used to reform subsidies transformed social contracts in fundamentally different ways and we hypothesize on the degree of intentionality of these differences

The developmental state in the 21st century: calling for a new social contract

Giulio Regeni: In memoriam Almost a year ago, on 13 January 2016, I had my last Skype conversation with Giulio, when he called from Cairo where he was conducting his field research for his doctoral studies. We exchanged thoughts on finalising the draft of this paper, which was the result of our collaboration during his time as a visiting researcher at the German Development Institute in the summer of 2015. A few days later, on 25 January, alerts on his sudden disappearance reached us. He was found lifeless on 3 February on the outskirts of Cairo, with signs of extreme torture. Giulio’s brutal passing, most probably at the hands of an increasingly repressive and paranoid Egyptian state, shocked not only those of us who knew him closely but also the larger development and regional studies community and social activist groups. This loss made it impossible for me to finish this draft for several months afterwards. Giulio, with a brilliant mind, a passion for development, and great faith in humanity, was an inspiration for those he engaged with. His understanding of the development process was shaped by scholars such as Alice Amsden, Diane Davis, Ha-Joon Chang and Peter Evans, clearly evidenced in this Discussion Paper. His precise writing skills and commitment to understanding sources of development are reflected throughout this joint effort, especially in Sections 2 and 4. Finalising this important paper without Giulio was hard as I was certain that these ideas would have benefited significantly from his insights. I do hope, however, that he would have enjoyed reading this final draft.Giulio, you will never be forgotten! Georgeta Vidican Auktor Abstract The ‘developmental state’ is a highly debated notion in development literature, having evolved from the extraordinary experience of late industrialising countries in East Asia. In this Discussion Paper we join a growing number of scholars to argue that changing global conditions call for a revitalisation of the debate on the role of the state in social and economic transformation in the 21st century. We focus on three main global challenges for economic development in the 21st century: climate change and environmental degradation; increased digitalisation (the increasingly ‘bit-driven’ economy); and changed policy space for individual states as a result of globalisation. These evolve simultaneously and reinforce each other. We argue that the global context calls for a change in the social contract that underpins structural economic transformation, by placing a stronger emphasis on cultivating inclusive state-society relations oriented towards promoting economic growth within planetary boundaries. Such emphasis is, in our view, currently under-represented in the emerging literature on a developmental state in the 21st century. For this reason, we consider it relevant not only to elaborate on the historical conditions that shaped the role of the state in industrial policy in late industrialising countries, but also on current challenges that call for a changing perspective on the role of the state in emerging and developing countries

The effectiveness of Morocco’s industrial policy in promoting a national automotive industry

Since the 1980s, international production patterns have fundamentally changed, creating opportunities for developing countries to integrate into global value chains (GVCs). Morocco, which is among the first countries in the Middle East and North Africa to pursue an export-led economic policy, has used this opportunity, among others, to develop an automotive supplier industry, which became one of the country’s industrial lead-sectors. This paper analyses how industrial policy and industry-level dynamics contributed to the emergence of an automotive supplier industry. We find that, although Morocco achieved its overall goal of establishing such an industry, this industry remains limited to low-value activities. With the aim of deepening the level of integration into GVCs and acquiring a dynamic competitive advantage in the automotive sector, the nature and objective of industrial policy in Morocco has changed in the past couple of years. Instead of focusing primarily on its labour-cost advantage to attract lead-firms to localise in Morocco, decision-makers currently are taking a more systemic approach to industrial policy, focusing on fostering synergies across sectors, creating ecosystems for different parts of the value chain, and using targeted support measures for enhancing workforce capabilities and competencies. We find evidence for a tendency towards the co-design of policy measures by public and private stakeholders, which, if it persists, could lead the way towards a more effective industrial policy. The main challenge for the future of the automotive sector in Morocco lies in a stronger inclusion of local firms in the value chain and a gradual shift towards higher value added. This will require a stronger focus on developing advanced technological skills and a higher level of investment in research and development

Subsidy reforms in the Middle East and North Africa: Strategic options and their consequences for the social contract

After independence, energy and food subsidies became a cornerstone of the social contracts in the Middle East and North Africa (MENA) countries. Governments spent heavily to reduce poverty and strengthen their own legitimacy. However, as government rents faded, subsidy spending became financially unsustainable and foreign donors pressed for reforms. Yet, reform has been challenging for all the governments as subsidies affect all consumers, therefore raising the risk of government delegitimisation. Several publications have analysed the subsidy reforms of various MENA countries, but few have systematically analysed their impacts on the prevailing social contracts. This paper shows that reforms in a key policy field such as subsidy spending can affect the nature of social contracts profoundly and distinctly, depending on the reform strategy. It assesses the reform processes that took place in Morocco, Egypt and Iran primarily between 2010 and 2017, thus before the United States once more tightened sanctions against Iran and before the COVID-19 pandemic broke out. We argue that governments applied distinct strategies to reduce subsidy spending without provoking major social unrest to reforms, with the effect that the social contracts of the three countries changed in quite different ways. Morocco's government removed most subsidies, especially those that predominantly benefitted the middle-class. [...

The transition towards a green economy and its implications for quality infrastructure

The transition towards a green economy has become an urgent need. A pre-condition for the effective development and diffusion of green technologies, as well as for increasing competitiveness, is the presence of well-functioning national quality infrastructure systems, comprising standards, conformity assessment (that is, inspection, testing and certification), metrology and accreditation. Building up relevant quality infrastructure capabilities is, therefore, decisive for effectively using, adapting and innovating technologies. This study examines the nexus between green technologies and quality infrastructure in developing countries. Using a mix of research methods, we explore a) which green technologies are diffusing and at what pace in developing countries, and (b) what quality infrastructure investments are needed to support, and benefit from, the transition towards a green economy