- World Development Report 2020: Trading for Development in the Age of Global Value Chains has been released by World Bank. The report examines that if there is any path of development through Global Value Chains (GVCs) and trade or not.
What is Global Value Chains (GVCs)?
- Global Value Chain means breaking up of the process of production of a single product between different countries. It means a single country performs only a specific function of the production of product and rest is done by other countries. For e.g.- One country exports the raw materials to other country. After this, that country prepares some parts of the product and exports it to other country which finally finishes the product. So, this entire chain is GVC.
Key Findings of the Report
- According to the report, Global Value Chains increased rapidly after the year 1990 but the expansion has slowed down after the 2008 global crisis.
- Two serious threats -arrival of labor-saving technologies such as automation and trade conflict among large countries have led to the segmentation of GVCs.
- However, new technologies are acting as both boon and bane. As technologies like automation can use less-labour intensive methods and reduce the demand of labour. Also, digital platform can reduce the cost of trade.
- According to the report, GVCs can still continue to increase growth, create better jobs, and reduce poverty if the developing countries undertake better reforms to promote GVCs.
- National Policies can increase participation in GVCs like promoting FDI; promote political stability, less taxes, etc.
- Other policies like sharing costs and benefits can also increase GVC participation.
- Along with this International Cooperation can result in boosting GVC participation.
Question
Q: 1. World Development Report 2020 has been released by which of the following organisations?1. International Monetary Fund
2. World Trade Organisation
3. United Nations Industrial Development Organization
4. World Bank
5. World Economic Forum
Answer- 4
Explanation- World Development Report 2020: Trading for Development in the Age of Global Value Chains has been released by World Bank. The report examines that if there is any path of development through Global Value Chains (GVCs) and trade or not.
