FEMISE is proud to launch its latest series of policy briefs, stemming from insightful conference papers presented at the FEMISE annual conference. These briefs are rooted in scientific research and offer actionable political recommendations to address critical challenges in the Euro-Mediterranean region.

The objective if this new series of Policy Briefs is to provide policy makers, international organisers, researchers and stakeholders in the EU-Med region with research-based policy recommendations that: advocate a better EU-Med integration;  promote mobilization of investments towards green transition and sustainable economies; empower young people through innovation and entrepreneurship advocacy; and facilitate a better and more equal integration of youth and women, aiming to create pathways for decent employment.

These Policy Briefs aspire to drive impactful dialogue and action across the EU-Med region.

Context

In the Euro-Mediterranean region, integration into Global Value Chains (GVCs) has long been seen as a pathway to economic growth, job creation, and industrial upgrading. However, the social outcomes of this integration remain uneven and often disappointing—particularly for low-skilled workers in Southern Mediterranean countries. While GVCs can drive efficiency and competitiveness, they do not automatically translate into better labour rights, reduced poverty, or equitable employment opportunities.

This policy brief addresses a critical yet underexplored question: why do some countries benefit more socially from GVC participation than others? It argues that a country’s absorptive capacity—its ability to leverage innovation, align education systems, and ensure strong governance—plays a central role in determining whether GVCs contribute to social upgrading or exacerbate inequalities. With rising unemployment and working poverty in many parts of the region, the findings offer timely insights for policymakers seeking to ensure that global trade serves not only economic but also social development goals.

Summary

This policy brief explores how countries in the Euro-Mediterranean region can turn their participation in Global Value Chains into tangible social benefits. Drawing on data from 63 countries between 2010 and 2020, the study assesses labour outcomes—such as employment, labour rights, and working poverty—through the lens of a country’s absorptive capacity. It finds that while GVC participation can improve labour conditions, its positive impact is neither automatic nor evenly distributed.

Countries with strong governance structures and investments in research and development are more likely to experience improved labour rights and reduced poverty. However, innovation without matching education and skills development can worsen unemployment—especially in sectors vulnerable to automation and outsourcing. The brief also reveals that Southern Mediterranean countries remain concentrated in low-value segments of GVCs, with limited access to high-tech or service-oriented industries.

To avoid deepening existing inequalities, the policy brief recommends targeted reforms including demand-driven education and vocational training, stronger labour protections, and enhanced regional cooperation. It also calls for bridging the North–South divide through joint ventures, technology transfer, and regional innovation hubs. Ultimately, the brief underscores the need for inclusive policies that make global integration work for all—especially the most vulnerable segments of the workforce.