Understanding linkages of future-making through global value chains

Far from the romanticized image of pristine wilderness and isolation, rural Africa is deeply embedded into the global political economy. To understand and explain how and with what consequences African rural futures are therefore linked to national, regional, and global dynamics, the concept of Global Value Chains provides a relational heuristic. Using the metaphor of chains, which transfer commodities, value, and power, global value chains are characteristic for their ability to create trans-territorial linkages way beyond the bordered containers of nation states.

The understanding of the global political economy as a relational construct has important implications for how we understand the development of regions and its inhabiting people. However local and ostensibly disconnected regions may seem, their inhabitants and also their future(s) are increasingly enmeshed into the networked dynamics of global value chains.

What many geographers describe therefore as an “increasingly globalizing regional development”, holds just as well true for the making of Africa’s rural futures. Value chains do not only move material things such as agricultural produce, tourists, and trophies from one territory to another. They parallelly function as conduits through which immaterial futures are imagined and eventually made possible or impossible.

Within our project Future in Chains: Socio-economic Impacts of Growth Corridors (C01), we therefore contribute to the Bridging Concept of “Linkages” with a focus on value chains. We do so by asking how value chains constitute trans-territorial constellations, what future-making practices these entail and how both affects socio-economic structures. For illustration, we draw from three examples from our project work.

Global futures of conservation: Capturing the gains from tourism and trophy hunting

Tourism is a central pillar of the development strategy for rural areas in Namibia. On the basis of a utilisationist agenda, Namibia promotes both trophy hunting and safari tourism in the Zambezi region which is part of one of the world’s largest transboundary conservation areas, the Kavango-Zambezi Transfrontier Conservation Area (KAZA). In terms of trophy hunting, the killing of emblematic wildlife comes with high license revenues whilst triggering regular outrage in the global media. The global tourism value chain further connects Zambezi region with high-value customers mainly from the global North. Zambezi region is therefore a resource region for both trophy hunting and tourism. This opens two questions: how is value created from nature and who is able to capture this value?

Community-based natural resource management policy is crucial to the valuation of nature, as communities are awarded use-rights over wildlife, thus enabling them to link up with the global tourism industry. By allocating a quota for hunting and allowing communities to enter into joint-venture partnerships with private enterprises, wildlife and scenic landscapes serve as a resource for creating a tourism experience that is subsequently sold as a commodity on global markets. Our research shows that the configuration of the tourism value chain is very different from the trophy hunting chain. While the former is dominated by lead firms in the global North, the latter is predominantly governed by Namibian hunting outfitters. This affects the distribution of value between actors of the chain and the locations along the chain: While roughly 20 % of revenues from both chains remain within the resource region, trophy hunting accounts for a higher share than safari tourism. This is especially affected by different institutional settings as well as governance structures in both chains.

As, the scope of action at national level is limited, both chains depend strongly on decisions taken at international or supra-national level. The heuristic of global value chains allows us to move between these spatial scales and thus unravel interdependencies and interrelationships between places that seem distant but are nevertheless deeply interwoven.

Global futures of agriculture: Socio-ecological transformations through the fertilizer chain

In Tanzania, our work highlights how the Southern Agricultural Growth Corridor of Tanzania (SAGCOT) created a global territory for investments into agricultural value chains. One of such chains experiencing substantial investments is the global value chain of synthetic fertilizer. This chain starts with the sourcing of natural gas in maritime deposits which is then shipped or piped to Northern manufacturing plants. Here, natural gas is used to convert atmospheric nitrogen into solid ammonia. Now material in small fertilizer prills, the commodity is then shipped to the Dar es Salaam port where it is bagged, labeled, and loaded on lorries. Annually, these lorries distribute more than 500,000 tons of fertilizer to the Tanzanian interior. Eventually, few bags, or even the portion of a bag, finally reach millions of smallholder farmers.

The fertilizer chain spans therefore from faraway places such as the Baltic Sea to some of the remotest regions of Tanzania. What was once stored in gaseous form under the sea, literally touches ground at the soil of Tanzanian farmers. This “touching ground” of the global value chain is however more than just a shift of material from one place to another. With it comes a set of pivotal issues affecting the fate of farming regions and its farmers.

One major question lies in value. Along the chain, different actors (manufacturer, importer, wholesaler, retailer) accumulate costs whilst trying to capture some value. This gradual built-up determines the farm gate fertilizer price. For farmers, the price is decisive for whether and with what outcomes they choose to apply fertilizer and – in the long term – what agronomic futures they pursue. Another question lies in the environmental sustainability of the same value chain. With ever more fertilizer shipped and spread through global value chains, both globally (climate change) and locally (soil structure), ecological futures are shaped and locked into distinct path-dependencies.

Against “global futures”: regional value chains for horticultural produce

The Zambezi region in Namibia is just as well crossed by a corridor. The Walvis Bay-Ndola-Lubumbashi Development Corridor (WBNLDC) links the Walvis Bay Port to land-locked African countries, mainly to enable trade of extractive resources such as Zambian copper. Albeit promoting the connection to global value chains beyond extractives, rural areas crossed by the corridor can however seldom link to global markets. The gross of the residents relies on agriculture. People and places hence remain largely disconnected from the aspired “modernisation” effects of corridors and global value chains.

The global division of labour, made visible through the global value chain concept, indirectly triggers local dynamics such as socio-spatial and economic inequalities and exclusion, which scholars increasingly address by asking who makes development for whom. The empirical example of horticulture in Zambezi region illustrates the importance of the political economy of agrarian policies and value chain linkages that affect small-scale farmers in various ways.

Our work on the regional horticulture value chain in Zambezi region highlights a mismatch between the top-down visions and bottom-up realities. This opposes to the notion of “global futures” fuelled through global value chains. We show how institutional layering of uncoordinated agrarian policies destabilises regional value chains for horticulture, which emerged only recently. Whereas protectionist border-closing practices enforced by the regulatory body of the government are supposed to integrate local farmers into value chains, they rather tend to destabilize markets due to their uncoordinated and unforeseeable character. Simultaneously, endogenous collective action of regional producers has emerged to react to the market and gain power, knowledge and resources. This enables farmers to creates links to regional markets, e.g. through verbal contracts with regional supermarkets that persist even when open borders allow for cheaper imports.

A nuanced analysis of these institutions on different scales helps to understand what impulses the making of regional value chains for strengthening rural economies rather than apply an understanding of global integration as panacea for “modernisation”.