Strategic Industries Between Geopolitical Instability and Back-Reshoring. The Restructuring of Global Value Chains in the Semiconductor, Biomedical and Pharmaceutical Industries

Antonio Russo

L'industria, 2023, issue 2, 345-200

Abstract: According to the hypothesis discussed in the paper, the main driver of back-reshoring is related to the deterioration of the current geopolitical framework. Strategies for the security and technological sovereignty push European Union and United States to reduce dependence on imports and long supply chains for products (as semiconductors, biomedical and pharmaceutical goods) and to encourage back-reshoring. The contribution has four closely interconnected objectives: a) to outline a critical analysis of the theory of global value chains and of the literature on back-reshoring to evaluate the drivers of this phenomenon; b) to discuss the data on back-reshoring in the European Union and in the United States, to highlight the trends underway before and after the pandemic crisis; c) to analyze the dynamics of back-reshoring in three industrial sectors (semiconductors, biomedical and pharmaceutical), strategic for the security and technological sovereignty of advanced States; d) to develop, starting from these analyses, policy suggestions related to back-reshoring. The analysis carried out reaches four conclusions. First, global geopolitical instability is steering governments towards neo-mercantilist policies. Second, industrial policies are the key drivers of back-reshoring. Third, the role of economic and technological factors as back-reshoring drivers appear rather controversial, with pressures that could also lead to increase the spatial dispersion of the gvcs. Fourth, tax incentives and financial support are insufficient to support back-reshoring; to support this process are needed policies aimed to support dynamic competitiveness of enterprises, and to structure innovative territorial ecosystems

Keywords: Back-Reshoring; Globalization; Delocalization; International Political Economy (search for similar items in EconPapers)
Date: 2023
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