International Trade Working Paper

The International Trade Working Paper series promptly documents and disseminates reviews, analytical work and think-pieces to facilitate the exchange of ideas and to stimulate debates and discussions on issues that are of interest to developing countries in general and Commonwealth members in particular. The issues considered in the papers may be evolving in nature, leading to further work and refinement at a later stage.


Value Chains and Connectivity in the Caribbean

This paper examines global value chain (GVC) activity in the Caribbean, through the lens of newly assembled data on value added trade. It finds that GVC participation is quite weak by world standards. Moreover, connections with the large regional markets of the USA and Canada are sometimes stronger than connections within the Caribbean. The paper then examines data that could help explain these findings, focusing on bilateral trade costs and transport connectivity, as influenced by non-traditional trade policies like regulatory barriers. It concludes that there is considerable scope for the Caribbean to promote value chain integration by improving connectivity in all its dimensions, especially air.


Keywords: connectivity, Caribbean, global value chains
JEL: F13: International Economics / Trade / Trade Policy; International Trade Organizations; F14: International Economics / Trade / Empirical Studies of Trade
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