Food Processing Industries in Visegrad Countries in Global Value Chains (1995–2018)

Ivo Zdráhal; J. Matthew Fannin

doi:10.18778/1508-2008.28.06

Authors

Ivo Zdráhal Mendel University in Brno, Faculty of Regional Development and International Studies, Brno, Czech Republic https://orcid.org/0000-0002-6631-8228
J. Matthew Fannin Louisiana State University, College of Agriculture, Baton Rouge, United States https://orcid.org/0000-0002-2407-7219

DOI:

https://doi.org/10.18778/1508-2008.28.06

Keywords:

European Union, fragmentation of production, participation, value added, vertical specialization

Abstract

The aim of the article is to evaluate the position in global value chains (GVCs) of food processing industries in the Visegrad countries (V4; Poland, Czechia, Hungary and Slovakia) between 1995 and 2018. To identify the intensity and forms of integration in GVC of these industries in each country and to compare it to the other V4 countries, we employed complex methods to measure the importance of foreign demand, (backward and forward) participation and position in GVCs, the territorial context of integration, and shifting patterns of the integration into GVCs using data from the TiVA database.

Our findings revealed variations in the integration of food processing industries in GVCs in the V4 countries. Common characteristics and trends were observed (e.g., increasing participation) until the Great Recession before stalling, increasing integration into European value chains, and absorption of foreign value added mostly from services industries. These trends are consistent with findings from previous studies.

A significant contribution of this study is that it reveals how food exports from the Czech Republic, Hungary and Slovakia are mostly linked to increased GVC participation. Notably, food processing industries in Hungary and Slovakia have continued to increase their participation in GVCs even after the Great Recession. Given the evidence of beneficial economic outcomes from increased participation in GVCs, this implies that the food processing industries in Hungary and Slovakia will become more competitive. Food industries in Poland and Hungary are positioning themselves relatively more downstream in the GVCs, while shifts in the Czech Republic and Slovakia are increasingly upstream. Given evidence of beneficial economic outcomes from increased participation in GVCs being more downstream in the GVCs, the V4 countries will need to evaluate how their trajectories may impact the future wellbeing of businesses and employees working in these industries.

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