The regionalisation of value chains is a very important development

A trend is under way with a shift from global value chains to regional value chains, due to evolving production costs, political constraints and the complexity of global value chains. The shift to regional value chains is a very important development: It makes international free trade agreements less effective; It should encourage countries to adopt strategies for regional economic integration; It creates a problem for countries whose growth is linked to global trade and which have weak growth in domestic demand.