The Integration of Global Value Chain in the EU: Stylized Facts and Drivers
January 9, 2026
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Summary
This paper examines EU global value-chain (GVC) integration and analyzes its drivers using machine learning models, with case studies of Portugal and Belgium. GVC participation appears to boost productivity and technology upgrading, but also brings concentration risks in the current environment. Results indicate labor cost, labor productivity and human capital as key drivers, supported by infrastructure, manufacturing base, and governance quality. Portugal remains downstream, constrained by low high-tech intensity, while Belgium is highly integrated but exposed to sectoral shocks. Strengthening the EU single market, capital-market integration, and individual countries’ investment in skills, innovation, and diversification would bolster resilience while preserving the benefits of openness.
Subject: Economic sectors, Exports, Global value chains, Globalization, International trade, Manufacturing
Keywords: Backward Linkages, Europe, Export, Exports, Forward Linkages, Global, Global Value Chain Integration, Global value chains, Machine Learning Methods, Manufacturing
Pages:
36
Volume:
2026
DOI:
Issue:
002
Series:
Working Paper No. 2026/002
Stock No:
WPIEA2026002
ISBN:
9798229035057
ISSN:
1018-5941
