Electricity Access and Participation in Global Value Chains in Africa: An Empirical Panel Study

This study analyses the effect of electricity access on participation in global value chains (GVCs) in 41 African countries between 1990 and 2018. By mobilizing static (fixed effects) and dynamic (two-stage GMM) panel estimation methods, and data from UNCTAD-EORA and World Development Indicators databases, the results show that a one-point increase of access to electricity significantly favours the rise of African countries’ integration into GVCs by about 0.0234%. This effect is robust to different measures of access to electricity and GVC participation. The results also show that gaps in access to electricity between urban and rural areas can reinforce unequal integration into global value chains, and that GVC participation is largely determined by the use of fossil fuels. Based on these findings, the study recommends investing in inclusive and sustainable electrification, particularly in rural and industrial areas, and establishing green regulatory frameworks to encourage the adoption of cleaner energies.