INSERTION OF BRAZIL IN GLOBAL VALUE CHAINS AFTER LABOR REFORM

Abstract

The process of fragmentation of production known as Global Value Chains (GVCs) has extinguished the need to acquire competence in all aspects of the production of a good and has enabled developing countries to join a cross-border cooperation network, sharing production and specializing in only one or a few stages of production activities involved in the production of a final good, making the importance of services for productive activities even more evident. Many studies have emerged to identify the main policies that could lead to greater insertion of countries in GVCs. Besides policies of openness to trade and foreign direct investment, one of the measures presented for cost reduction and greater competitiveness is labor reform. In Brazil there was a labor reform in 2017. The main argument for its implementation was the generation of more jobs, giving the country greater competitiveness to its industry and, consequently, better conditions for insertion in international trade. This paper aims to analyze the insertion of the Brazilian economy in the GVC before and after the labor reform, showing that the indicators and studies point to the fact that there was no upgrade in the insertion of the country in GVC, indicating that in Brazil  predominates a strategy of  limited insertion in the GVC, as it is based on activities related to the cost of cheap labor and low level of technological intensity, such as the production of food, beverages, textiles and shoes, among others.