What Is Required for African-owned Firms to Enter New Export Sectors? Conceptualizing Technological Capabilities within Global Value Chains

Capitalist transformation is composed of many multifaceted processes, but growth in the size and capabilities of locally owned firms is essential. The AfriCap research project aims to understand how African-owned firms learn and build their technological capabilities in order to enter and remain competitive in new export sectors. The purpose of this first working paper is to advance our conceptualization of what it means to build capabilities within globalized industries. The paper draws on the conception of technological capabilities from the Technological Capabilities literature, but adapts it to the context of global value chains and the specific requirements demanded and capabilities needed in this regard. It does so by drawing on the Global Value Chain and Global Production Network approaches. This approach offers conceptual tools for
understanding firm-level processes of learning and capability building as well as how these firm-level processes are influenced and shaped by the specificities of the industry and global value chain in which they operate, as well as the national institutional and policy context. The paper concludes by showing how this conceptual approach can be operationalized in the context of specific global value chains.