Global Value Chains: A Developmental Tool for Lebanon

Global Value Chains have emerged as a vital developmental tool for developing countries like Lebanon. Participation in GVCs facilitates the transfer of skills, knowledge, and innovation, which are essential for enhancing local industries and increasing wages, ultimately contributing to poverty alleviation. However, these gains come with risks. Countries may find themselves stuck at the bottom of the value chain, engaging in low value-added activities. Over the past decade, Lebanon has experienced a decline in its participation in GVCs, alongside a deterioration in its development conditions, primarily due to several policy-related factors. A business-friendly environment, efficient public governance, and GVC-oriented public policies focused on improving infrastructure quality, developing legal frameworks to combat corruption, and enhancing environmental regulations are crucial for maximizing the benefits of GVC participation.