Leveraging Global Value Chains for innovation and industrialization in Africa

Abstract

The global nature of innovation has led to the emergence of Global Innovation Networks (GINs) and Global Value Chains (GVCs), facilitating knowledge exchange and economic activities across borders. GVCs offer platforms for accessing external knowledge and fostering innovation. They have evolved through three eras of innovation models: the Linear and Closed Model (LCM), the Interactive and Closed Model (ICM), and the Interactive and Open Model (IOM). The IOM emphasizes open innovation principles, intersecting with GINs and GVCs. Lessons from East Asian and Latin American countries highlight strategic practices for GVC integration, focusing on export-oriented industrialization, education, technology policies, infrastructure, and SME support. In Africa, GVC engagement spans agriculture, manufacturing, and services sectors, driving economic growth, job creation, and technological advancements. To advance GVC participation in Africa, a research agenda, policy directions, and action plans are proposed. The research agenda emphasizes GVC governance, value addition, sustainability, innovation, and regional integration. Policy directions focus on infrastructure development, trade facilitation, SME support, human capital development, and promoting sustainable and inclusive growth. African businesses are encouraged to conduct value chain mapping, form strategic partnerships, embrace technology, ensure quality assurance, invest in capacity building, and diversify markets to leverage the potential of GVCs for economic transformation and global competitiveness.

Keywords:

• Global Innovation Networks (GINs)
• Global Value Chains (GVCs)
• open innovation
• export-oriented industrialization
• African GVC engagement
• sustainable development

List of Abbreviations

GVCs –	=	Global Value Chains
GINs –	=	Global Innovation Networks
LCM –	=	Linear and Closed Model
ICM –	=	Interactive and Closed Model
IOM –	=	Interactive and Open Model
R&D –	=	Research and Development
GPN –	=	Global Production Network
GCC –	=	Global Commodity Chain
SMEs –	=	Small and Medium-sized Enterprises
STEM –	=	Science, Technology, Engineering, and Mathematics
FDI –	=	Foreign Direct Investment
SEZs –	=	Special Economic Zones
ISO –	=	International Organization for Standardization

Introduction

Recent literature suggests that innovation is not confined within national boundaries; rather, innovation processes can be fragmented and distributed across borders, giving rise to Global Innovation Networks (Kano 2018; Mudambi and Puck 2016; Ryan, Gibbons, and Osburg 2020; Szapiro and Mao 2018). GVCs and offshoring create a unique global platform for businesses to access external knowledge, fostering innovation (Perri, Scalera, and Mudambi 2017).

The literature on innovation in GVCs has evolved over the decades, delineated into three eras. Cohendet, Parmentier, and Simon (2017) and Cohendet and Simon (2017) shed light on the dominant models of innovation in GVCs and how these have evolved over time. These models include:

1. Linear and Closed Model (LCM): Also known as the Linear Technology-push Model, this approach views technological change as occurring externally to the economic development sphere. It emphasizes the role of ‘big science’ in the innovation process and advocates for supporting basic research (Bathelt, Feldman, and Kogler 2017; Cohendet and Simon 2017). The LCM prevailed from the post-World War I era to the mid-1980s, marked by economic depression and labour shortages.

2. Interactive and Closed Model (ICM): This model takes an evolutionary approach to economic change literature, highlighting the interactive nature of the innovation process. Unlike the LCM, the ICM views technological change as internal to the economy and emphasizes interactions among actors in the innovation process (Dosi 1982; Dosi and Winter 1994; Nelson and Winter 1982). It prevailed from the mid-1980s to the early twenty-first century.

3. Interactive and Open Model (IOM): Emerging in the early twenty-first century, this model builds upon open innovation principles, positing that knowledge can no longer be sourced solely within organizational networks or national boundaries. External organizations, particularly in other countries, serve as sources of knowledge for lead firms, emphasizing the importance of leveraging distributed pools of knowledge for innovation (Ambos et al. 2021; Lema, Pietrobelli, and Rabellotti 2019; Lema, Rabellotti, and Gehl Sampath 2018).

The Interactive and Open Model (IOM) of innovation is intricately linked to both Global Innovation Networks (GINs) and Global Value Chains (GVCs), as evidenced by scholarly research and theoretical frameworks. The IOM emphasizes the importance of open innovation and the distributed nature of knowledge creation and diffusion. This aligns closely with the concept of Global Innovation Networks (GINs), which are networks of interconnected organizations across different countries collaborating on innovation activities (Cantwell and Mudambi 2011). Scholars have noted that GINs facilitate the exchange of knowledge, resources, and expertise among firms, research institutions, and other stakeholders globally (Gerybadze and Reger 1999; Mudambi and Swift 2011). The IOM also intersects with GVCs, as both concepts recognize the global dispersion of economic activities and the importance of collaboration across borders. GVCs involve the fragmentation of production processes across different countries, with firms coordinating activities to maximize efficiency and value creation (Gereffi, Humphrey, and Sturgeon 2005). The IOM acknowledges that innovation processes can be decentralized and distributed across various stages of GVCs, with firms accessing external knowledge and resources to enhance their innovation capabilities (Perri, Scalera, and Mudambi 2017).

Over the past twenty years, scholarly attention has been directed towards understanding the geographical dispersion of production across different regions and countries. This body of literature has delved into the factors driving international production fragmentation, known as Global Value Chains (GVCs) (e.g., Gereffi, Humphrey, and Sturgeon 2005; Lee, Szapiro, and Mao, 2018). The fragmentation inherent in GVCs suggests that innovation activities can be geographically dispersed and detached from other tangible GVC activities. However, the discussion on GVCs remains inconclusive, with divergent views among scholars. Some argue that fragmented production can benefit lead firms by freeing up resources for Research and Development (R&D) or machinery acquisition (Ambos et al. 2021; Deqiang et al. 2021), while others contend that international offshoring may constrain lead firms’ innovation capabilities (Morrison, Pietrobelli. and Rabellotti 2008; Lema, Quadros and Schmitz 2015).

Concept of Global Value Chains

The transformation of business operations due to technological advancements and globalization has been profound. Lead firms now manage production and value-added services through complex networks spanning multiple countries, often outsourcing production to developing nations (Gereffi 2018). These networks, known as Global Value Chains (GVCs), involve various stages of manufacturing distributed across different nations, each specializing in specific aspects of the production process, from design to distribution (Gereffi 2019).

The key components of GVCs include:

Production: This phase involves converting inputs into intermediate or finished goods, encompassing tasks such as manufacturing, assembly, and quality control, with different nations specializing in distinct production stages.

Distribution: Encompassing logistics, transportation, and storage, this phase involves tasks like packaging and delivering goods to merchants, wholesalers, or customers.

Marketing and Sales: Activities include advertising, branding, promotion, and sales of finished products, with companies often tailoring their marketing strategies to local or national markets.

Services: Critical to GVCs, services include consultancy, design, research and development, and customer service, either provided by specialized firms or integrated into the production process.

Trade and Investment: International trade and investment flows are essential for linking various production phases across nations, enabling specialization based on comparative advantages.

Governance and Coordination: This involves firm collaboration, supply chain management, and decision-making processes, achieved through contracts, partnerships, and strategic alliances.

Modernization and Innovation: Companies in GVCs continually seek to enhance their competitive edge through advancements in technology, processes, skills development, and the adoption of new technologies.

A global value chain comprises three primary parts:

Upstream Activities: These include research & development, design, and sourcing raw materials or components, focusing on innovation, technological transfer, and coordination of production inputs.

Midstream Activities: Involving the conversion of raw materials into final goods, this step often occurs in countries with lower production costs or specialized knowledge.

Downstream Activities: Encompassing marketing, distribution, and post-sale services, this phase includes branding, promotion, logistics, and customer service.

Theoretical frameworks such as the Global Production Network (GPN), Global Commodity Chain (GCC) analysis, Upgrading and Innovation Framework, and Regional and Territorial Development Approaches provide insights into the structure, dynamics, and governance of GVCs, aiding in understanding their implications for businesses, nations, and regions (Gereffi 1999; Humphrey and Schmitz 2002). These frameworks highlight the significance of social dynamics, power imbalances, and value distribution within GVCs, emphasizing the role of lead firms in coordinating activities and extracting value (Gereffi 1999). Additionally, they underscore how participation in GVCs can facilitate skills development and the transition to higher value-added enterprises, contributing to economic growth and development.

An overview of the status of Global Value Chains in Africa

The emergence of Global Value Chains (GVCs) has ushered in a paradigm shift in the global economic landscape, fundamentally altering the dynamics of production and distribution across international borders. GVCs represent intricate networks of interconnected firms spanning multiple countries, each specializing in specific stages of the production process, from raw material extraction to final product assembly (Gereffi 2018). This global phenomenon holds immense potential for driving economic growth, creating employment opportunities, and fostering technological advancements through heightened economic integration and specialization.

In the context of Africa, while scholarly attention on GVCs in the region remains relatively limited, the continent's abundant resources and burgeoning economy have spurred efforts towards integration into these global production networks. Evidence gleaned from extant literature underscores Africa's endeavours to carve a niche within GVCs (Amanor 2019; Azmeh, Nguyen, and Kuhn 2022; Barrientos et al. 2016; Del Prete, Giovannetti, and Marvasi 2017; Farole and Winkler 2014; Foster-McGregor, Kaulich, and Stehrer 2015). However, achieving full integration poses a formidable challenge, notwithstanding notable progress in recent years.

Agriculture, a cornerstone of Africa's economy, stands as a focal point for GVC engagement. The continent's participation in GVCs spans various agricultural sectors, with notable strides observed in agro-processing activities aimed at adding value to raw agricultural products. Notable examples include the burgeoning horticulture industry in nations like Kenya, Ethiopia, and Tanzania, where investments in production and post-harvest processing infrastructure have facilitated integration into GVCs (Deininger and Squire 2006). Similarly, efforts to enhance value addition in coffee and cocoa production in countries such as Ethiopia, Uganda, Ghana, and Nigeria underscore Africa's commitment to leveraging GVC participation for economic development.

Moreover, Africa's manufacturing sector is experiencing a resurgence, with countries like Kenya and Ethiopia emerging as active participants in GVCs. Ethiopia's success in attracting international apparel producers through incentives like cheap labour and industrial parks exemplifies the potential of GVCs to spur job creation and economic growth. Investments in the manufacturing sector have not only bolstered industrial output but also stimulated backward linkages with domestic suppliers, thereby fostering SME development and regional economic expansion.

The services sector presents yet another avenue for African countries to tap into GVCs, particularly in tourism, banking, and information technology-enabled services (ITES). Remarkable progress has been witnessed in nations like Mauritius and Rwanda, where investments in telecommunications infrastructure and business process outsourcing have catalyzed employment opportunities and technological dissemination.

Furthermore, Africa's rich endowment of natural resources, including oil, gas, minerals, and precious metals, positions the continent as a key player in global value chains. Countries like South Africa, Nigeria, and Angola play pivotal roles in resource production and refinement, albeit grappling with challenges such as price volatility and environmental concerns (AfDB 2018). Efforts to maximize the value derived from these resources within GVC frameworks are crucial for sustainable economic development and inclusive growth across the continent.

Lessons from GVC practices from East Asian and Latin American countries

The emergence of Global Value Chains (GVCs) has redefined the dynamics of international trade and production, necessitating the adoption of strategic practices by businesses and organizations to effectively navigate and participate in these complex networks. Global Value Chain practices encompass a spectrum of strategies, procedures, and actions aimed at optimizing production, enhancing efficiency, and maximizing value creation within the global production landscape (Kano, Tsang, and Yeung 2020). As the global economy undergoes profound transformations, newer multinational companies, particularly from East Asian and Latin American countries, have risen to prominence, leveraging strategic policies and focused efforts to integrate into GVCs.

In East Asia, nations such as Japan, South Korea, Taiwan, and Singapore have emerged as significant players in the global production landscape, spearheading strategic initiatives to bolster their participation in GVCs. Key practices include:

Export-Oriented Industrialization: East Asian countries have embraced export-oriented industrialization as a cornerstone strategy for GVC integration, focusing on supplying goods and services to global markets. This approach entails infrastructure development to facilitate trade, export promotion initiatives, and the creation of conducive investment environments.

Investment in Education and Research: Recognizing the pivotal role of human capital in driving innovation and technological advancement, East Asian nations have made substantial investments in education and research, particularly in STEM fields. These investments aim to cultivate a skilled workforce capable of driving technological innovation and adaptation.

Technology and Innovation Policies: To enhance industrial capabilities and ascend the value chain, East Asian countries have implemented comprehensive technology and innovation policies. These policies encompass initiatives to stimulate R&D, support entrepreneurship and startups, facilitate technology acquisition, and foster innovation clusters (Amsden 2009).

Infrastructure Development: Recognizing the critical role of infrastructure in facilitating trade and attracting foreign investment, East Asian countries have made significant investments in transportation networks, energy infrastructure, and communication systems. These infrastructure developments aim to enhance connectivity with international markets and improve logistical efficiency.

Openness to Foreign Direct Investment (FDI): East Asian nations have actively pursued policies to attract FDI by creating favourable business environments, including the establishment of special economic zones (SEZs) offering tax incentives and simplified regulations. This conducive FDI climate promotes knowledge transfer, technology diffusion, and access to global markets (Haddad 1993).

Quality Control & Standards: East Asian countries have implemented rigorous quality management systems and standards to enhance the quality and consistency of their products. Initiatives such as ISO 9001 certification, supplier development programs, and product standardization efforts underscore their commitment to meeting global quality requirements and ensuring customer satisfaction.

Similarly, Latin American countries have pursued distinct strategies and practices to enhance their participation in GVCs, leveraging policy reforms, infrastructure investments, human capital development, innovation promotion, and SME support:

Policy Reforms: Latin American nations have undertaken policy reforms to improve the business environment and attract FDI, including trade liberalization, customs streamlining, and the establishment of special economic zones. For example, Mexico's Maquiladora program, initiated in the 1960s, fostered manufacturing zones focused on exports and favourable tax treatment, attracting substantial international investment.

Infrastructure Investment: Latin American countries have prioritized infrastructure investment to enhance national competitiveness in GVCs, particularly in transportation networks such as highways, ports, and airports. Brazil, for instance, has modernized its infrastructure to support its agro industry, which helped it to become a significant player in GVCs.

Developing Human Capital: Recognizing the importance of a skilled workforce in GVC participation, Latin American countries have invested in educational and vocational training programs to enhance workforce skills. Chile, for example, is implementing education reforms to improve workforce quality, with a focus on STEM education.

Promoting Innovation and Technology: Latin American nations have prioritized innovation and technology as key drivers of competitiveness in GVCs, implementing policies to support R&D, foster collaboration between academia and industry, and incentivize technology transfer. For example, Costa Rica, through free trade zones and tax incentives, has attracted high-tech industries.

Support for SMEs: Latin American governments have implemented programs to support SMEs’ integration into GVCs, including technological transfer assistance, access to finance, and networking opportunities. For instance, Mexico's ProMéxico agency offers programs to help SMEs access GVCs.

Research agenda for African scholars for a better understanding of GVC integration

GVC Governance and Institutional Frameworks: Investigate the effectiveness of existing governance structures and institutional frameworks in facilitating Africa's integration into GVCs. Assess the role of regional economic communities and national policies in promoting GVC participation and identify areas for improvement.

Value Addition and Upgrading Strategies: Explore mechanisms for enhancing value addition and upgrading along African GVCs, particularly in agriculture, manufacturing, and services sectors. Analyze successful case studies and identify key drivers and barriers to value chain upgrading.

Sustainability and Inclusivity in GVCs: Examine the social, economic, and environmental dimensions of Africa's participation in GVCs. Investigate strategies for promoting sustainability, inclusivity, and gender equity within GVCs, considering the impact on local communities and smallholder farmers.

Technological Innovation and Digitalization: Investigate the role of technological innovation and digitalization in enhancing Africa's competitiveness within GVCs. Assess the adoption of digital technologies, such as blockchain and artificial intelligence, in optimizing supply chain management and fostering innovation.

Regional Integration and Trade Agreements: Evaluate the impact of regional integration initiatives and trade agreements on Africa's GVC participation. Analyze the implications of intra-African trade and regional value chains for economic development and identify opportunities for deeper integration.

Policy guidelines for African governments for improved integration into GVCs

Enhancing Infrastructure Development: Prioritize investments in transportation, energy, and communication infrastructure to improve connectivity and reduce logistics costs along GVC corridors. Develop policies to attract private sector investment in infrastructure projects and promote public-private partnerships.

Promoting Trade Facilitation: Streamline customs procedures, reduce trade barriers, and harmonize regulations to facilitate cross-border trade and investment. Enhance trade facilitation measures, such as single window systems and electronic documentation, to expedite clearance processes.

Supporting SMEs and Local Enterprises: Implement policies to support SMEs and local enterprises in accessing GVC opportunities. Provide targeted financial assistance, capacity-building programs, and technical support to enhance SME competitiveness and integration into global value chains.

Investing in Human Capital Development: Strengthen education and vocational training programmes to equip the workforce with relevant skills for GVC participation. Foster partnerships between academia, industry, and government to promote STEM education and lifelong learning initiatives.

Promoting Sustainable and Inclusive Growth: Integrate sustainability and inclusivity considerations into GVC policies and strategies. Implement measures to ensure that GVC participation contributes to poverty reduction, gender equality, and environmental sustainability.

Strategy for African businesses for improved integration into GVCs

Value Chain Mapping and Analysis: Conduct comprehensive value chain mapping exercises to identify key stakeholders, activities, and linkages within GVCs. Analyze value chain dynamics, competitive forces, and opportunities for value addition and upgrading.

Strategic Partnerships and Collaboration: Form strategic partnerships with multinational corporations, suppliers, and service providers to access global markets and technologies. Collaborate with industry associations, research institutions, and government agencies to leverage resources and expertise.

Technology Adoption and Innovation: Embrace digital technologies and innovation to enhance efficiency, productivity, and competitiveness along the value chain. Invest in research and development initiatives, technology transfer programmes, and pilot projects to drive innovation and adaptation.

Quality Assurance and Standards Compliance: Implement robust quality assurance systems and standards compliance measures to meet international requirements and customer expectations. Obtain relevant certifications, adhere to product specifications, and continuously improve quality management practices.

Capacity Building and Skills Development: Invest in workforce training and skills development programmes to enhance employee capabilities and competencies. Provide opportunities for continuous learning, cross-functional training, and knowledge sharing to build a skilled and adaptable workforce.

Market Diversification and Export Promotion: Explore opportunities for market diversification and export promotion to reduce dependency on specific markets and products. Expand market access through trade shows, e-commerce platforms, and international marketing campaigns to reach new customers and regions.

By implementing these research agendas, policy directions, and action plans, African stakeholders can effectively harness the potential of global value chains to drive economic transformation, foster inclusive growth, and enhance competitiveness on the global stage.

This special issue presents the following contributions

The paper entitled “Learning-by-exporting in South Africa: The influence of global value chain (GVC) participation and technological capability” probes the impact of global value chain (GVC)-related trade on the performance of manufacturing firms in South Africa. Utilizing firm-level panel data from the South African Revenue Service and National Treasury spanning the years 2009–2017, the study examines how participation in GVC-related trade influences the productivity of these firms. To conduct the analysis, the paper categorizes internationally traded products into different groups based on existing classifications and then compares the productivity benefits for firms engaged in trading these various categories of products. Additionally, the study explores whether there are differences in the learning-by-exporting effects across these identified categories of GVC-related products by analyzing the effects of exporting both before and after entering foreign markets. The findings of the study reveal that GVC-related trade is associated with a higher productivity premium when compared to traditional trade. However, within the subset of exporting firms, it is observed that only those firms dealing specifically with GVC-related products and simultaneously investing in research and development (R&D) during the post-entry periods demonstrate significant learning effects from exporting. These results emphasize the advantages of integrating into GVCs in terms of the productivity gains experienced by firms engaged in such trade. Furthermore, they underscore the importance of GVC-integrated firms investing in technological capacity building, particularly through R&D activities, to fully capitalize on the benefits of participating in global value chains.

The paper entitled “Technological upgrading along global value chains: The case of automation and digital technologies in the automotive sector in South Africa” adds valuable insights to the expanding body of literature on technological upgrading within global value chains (GVCs). Specifically, it focuses on the adoption of automation and digital technologies across different functional stages of the automotive value chain. One of the key contributions of this paper lies in its exploration of the ongoing tension faced by firms in emerging economies. These firms must navigate the delicate balance between integrating into international trade networks and ensuring the continuous improvement and upgrading of local firms. This balance is intricately linked to the relationship between lead international firms’ operations and the capabilities of local firms. Drawing upon extensive qualitative research conducted in South Africa, which includes 39 interviews and observations at the shopfloor level, the paper delves into the determinants influencing the adoption of automation and digital technologies. By examining both final assemblers and lower-tier suppliers, the study provides a comprehensive understanding of the factors driving technological upgrading along the automotive value chain. The findings of the research highlight four production-specific drivers that influence the adoption of automation and digital technologies: volume, quality, material-led adoption, and ergonomics. These drivers shed light on the nuanced dynamics at play within the automotive sector, offering valuable insights for policymakers. Furthermore, the paper underscores the importance for policymakers to consider sector-specific heterogeneity and the unique combinations of sectors and technologies when designing policies aimed at promoting digitalization and production upgrade. By acknowledging these factors, policymakers can tailor interventions to address the specific needs and challenges faced by firms operating within different segments of the automotive value chain in South Africa. Ultimately, this targeted approach can contribute to the sustainable growth and competitiveness of the automotive industry in the region.

The paper titled “A systematic literature review and mapping of systemic barriers to digital learning innovation in Africa in the context of changing global value chains” presents an exploratory study that delves into the realm of digital learning within the framework of National Innovation Systems (NIS) and Global Value Chains (GVCs). This research addresses two interconnected questions: firstly, it seeks to identify the systemic barriers to Digital Learning Innovation (DLI) experienced by universities in Africa, and secondly, it aims to discern the trends and factors influencing digital learning innovation within African universities from both continental and global perspectives. To accomplish this, the study employs a methodological approach grounded in the systematic literature review (SLR) framework, utilizing PRISMA and Scopus data. The SLR process is conducted in both broad and narrow scopes, supplemented by bibliometric analysis techniques such as biographic coupling and co-citation analysis. Furthermore, the study integrates additional data sources, including university ranking data from the Webometrics index and country ranking data from the Global Innovation Index (GII), to develop a comprehensive understanding of the landscape. In conducting the broad SLR, a vast global sample of 63,477 studies related to digital learning is screened from which two African sub-samples comprising 2,640 and 4,699 studies are extracted. Subsequently, the narrow SLR focuses on 4,091 studies encompassing DLI, Innovation Systems (IS), and Innovation Barriers (IB), yielding a sample of 221 relevant studies. The findings of the study highlight a notable gap in both literature and innovation within the African context. Despite the growing importance of digital learning and its potential to drive innovation, the research indicates a limited overlap between literature on DLI, IS, and IB, with minimal emphasis on the role of GVCs. This gap underscores the need for further research and exploration in these areas. In response to these findings, the paper not only provides empirical data to inform public policy but also proposes a conceptual model and typology aimed at guiding future research endeavours. By elucidating the systemic barriers to digital learning innovation and contextualizing them within the evolving dynamics of global value chains, this research contributes to a deeper understanding of the challenges and opportunities facing African universities in the digital age. Moreover, it offers valuable insights for policymakers and stakeholders seeking to foster innovation and technological advancement within the education sector, ultimately paving the way for more inclusive and effective digital learning initiatives across the continent.

The paper titled “Digitalization and small businesses supply chain financing: Evidence from sub-Saharan Africa” provides research into the crucial role of supply chain finance in supporting businesses with limited access to traditional forms of financing, particularly in the context of sub-Saharan Africa. Considering the disruptions brought about by the fourth industrial revolution, the study highlights the potential for digitalization to enhance participation in supply chain finance, especially among small businesses in Africa. While the impact of digitalization on supply chain finance has been studied elsewhere, there is still a dearth of evidence from the African context. To address this gap, the study utilizes a dataset comprising observations from 4,409 small businesses across Sub-Saharan Africa, including those in the agricultural sector. Four key indicators of digitalizationznamely, the use of company websites, social media platforms, online advertisements, and mobile phone ownership – are employed to construct an index of digitalization. A logit regression model is then applied to analyze the dataset and assess the effect of digitalization on the adoption of supply chain finance by small businesses. The results of the analysis demonstrate a significant correlation between digitalization and the adoption of supply chain finance by small businesses in Africa. Importantly, this relationship remains robust even after controlling for potential confounding factors. Additionally, the study identifies other determinants of supply chain finance adoption, such as education level, company age, and participation in government training programmes, indicating the multifaceted nature of factors influencing financing activities among small businesses. Moreover, the study highlights variations in the adoption of supply chain finance across different countries and economic sectors, with notable differences observed between small agricultural businesses and those in other sectors. These findings underscore the need for tailored approaches to financing that consider the unique characteristics and challenges faced by businesses operating in various contexts within Sub-Saharan Africa. Considering these insights, the paper calls for concerted efforts to promote digitalization among small businesses in the region. This includes scaling up investments in digital infrastructure by African governments and maintaining a favourable regulatory environment conducive to the development of inclusive digital markets. Furthermore, the study emphasizes the importance of future research to explore available digital solutions, assess adoption costs, and identify factors influencing demand for supply chain finance among small businesses in Sub-Saharan Africa. By addressing these issues, policymakers and stakeholders can work towards enhancing financial inclusion and promoting sustainable economic growth across the region.

The paper titled “How open are African inventors? Open green technologies and patenting activities in Africa” sheds light on the crucial role of open green innovation in advancing decarbonization efforts across the African continent. Despite the recognized importance of green innovation, there remains a lack of empirical evidence regarding the current state of green innovation activities in Africa, which often poses challenges for policymakers in designing effective green innovation policies. To address this gap, the study delves into the incidence of collaboration in inventive activities within Africa, focusing on both climate adaptation and mitigation technologies. Using the ‘designation of the inventor’ data available in the online European Patent database, the researchers identify and assess open and closed climate adaptation and mitigation inventions through explorative and network analysis techniques. The findings of the research reveal several key insights. Firstly, the study highlights that while climate change adaptation technologies hold greater value, climate change mitigation technologies exhibit a higher level of responsiveness to open innovation approaches. Additionally, the research identifies a slight increase in the number of green inventions in Africa. However, a significant portion of these inventions remains closed rather than open for collaboration. One notable observation is the limited presence of collaborative open green inventions in Africa, indicating a fragmented landscape within national innovation systems across many African countries. This lack of collaboration suggests a disconnect between universities and firms, indicating that many knowledge institutions in Africa have not fully evolved into vibrant sources of learning for national economic development. Overall, the paper underscores the importance of fostering open innovation ecosystems in Africa, particularly in the context of green technologies, to accelerate progress towards decarbonization and sustainable development goals. By promoting collaboration and knowledge sharing among various stakeholders, including universities, research institutions, and businesses, African countries can harness the power of innovation to address pressing environmental challenges and drive inclusive economic growth. The insights provided by this study offer valuable guidance for policymakers and stakeholders seeking to strengthen innovation ecosystems and promote sustainable development in Africa.

The paper titled “Awareness and adoption of circular economy in the consumption and production value-chain among MSMEs towards sustainable development” delves into the disruption caused by the COVID-19 pandemic in the global value chain, particularly impacting micro, small, and medium enterprises (MSMEs), with Africa experiencing significant challenges exacerbated by limited government support. In response to such disruptions, the circular economy (CE) emerges as a sustainable alternative to the traditional linear economic model, offering solutions to resource scarcity within the value chain and promoting environmental sustainability. The study aims to evaluate the awareness, level of adoption, and key driving factors of CE among MSMEs in Nigeria. Through a sample of 206 MSMEs, the research uncovers moderately high levels of awareness regarding CE, albeit with a relatively low level of adoption within the sampled enterprises. Employing logistic regression analysis, the study identifies several key drivers of CE adoption, including top management commitment, digital technology integration, regulatory incentives, and access to financial resources. Furthermore, the findings underscore the importance of enhancing employee training in CE practices, fostering collaboration among companies and customers within the value chain, and advocating for government policies that promote CE adoption. Specifically, the study emphasizes the need for government intervention to raise awareness among business enterprises regarding the benefits of CE adoption, provide financial support for small enterprises to facilitate CE integration, and encourage inter-organizational cooperation within the value chain. In summary, the paper highlights the potential of CE to address sustainability challenges within MSMEs in Nigeria and emphasizes the crucial role of various stakeholders, including top management, government authorities, and industry partners, in driving CE adoption and fostering a transition towards a more sustainable and resilient economic model. By addressing barriers to adoption and promoting collaborative efforts, MSMEs can leverage the principles of the circular economy to enhance resource efficiency, reduce environmental impact, and contribute to long-term sustainable development goals.

The paper titled “Assessment of factors driving cryptocurrency investment decision in Africa: A case of Bitcoin in Nigeria” delves into understanding the determinants influencing Nigerian investors’ decisions to engage in the Bitcoin market. By integrating factors such as awareness, religious beliefs, and trust with the theory of reasoned action, the study aims to provide insights into the complex motivations behind cryptocurrency investment. To conduct the research, data was collected from 262 individual investors in Nigeria using a questionnaire and a random sampling technique. The structural equation model method was then employed to analyze the data and derive meaningful conclusions. The findings of the study reveal several key insights. Firstly, attitude, awareness, and trust were identified as significant and positive influencers on Nigerian investors’ decisions to invest in the Bitcoin market. Additionally, religious beliefs and awareness were found to have significant impacts on investors’ levels of trust in Bitcoin transactions. These findings suggest important implications for policymakers and regulatory agencies in Nigeria. It underscores the importance of increasing public understanding and confidence in cryptocurrencies by collaborating with financial sector stakeholders and religious institutions. By doing so, policymakers can create new market opportunities, promote financial inclusion, generate employment opportunities for Nigeria's youthful population, stimulate economic growth, and enhance public participation in the cryptocurrency market. Overall, the study contributes to the cryptocurrency literature by demonstrating that investment decisions in Bitcoin are influenced not only by economic factors but also by social and religious considerations. This nuanced understanding can inform policymakers and market participants in designing strategies and interventions aimed at fostering a conducive environment for cryptocurrency adoption and investment in Nigeria.

Acknowledgement and funding

We gratefully acknowledge the support from the African Network for the Economics of Learning, Innovation and Competence Building Systems (Africalics) Secretariat under the Africalics Thematic Chair Seedfunding 2022–2023.

Disclosure statement

No potential conflict of interest was reported by the authors.