S10 - Session O2 - Can there be value chains without values ? Shadow economies and value chains

Authors: Laurent Parrot *, Yannick Biard, Dieuwke Klaver, Edit Kabré, Henri Vannière

The shadow economy needs to be explicitly considered because it affects the implementation of public policies and therefore the justification of State intervention. The aim of this paper is to study the impact of the shadow economy on the sustainability assessments of value chains. We applied the different forms of the shadow economy to the economic, environmental, and social assessments of five mango value chains in Burkina Faso. We considered the added value and employment, distance and technology level, access to land and child labor. The shadow economy represents about 80% of the economy of Burkina Faso. About 96% of the working population does not have a permanent formal contract. From an economic standpoint, the shadow economy in the mango value chain represents only about 30 % of the total added value, predominantly for fresh mangoes consumed in Burkina Faso. However, about 99% of the 27,000 of the workers involved in the value chains do not have permanent formal contracts. From an environmental standpoint, we found that the value chains predominantly use old and poorly maintained trucks over long distances. This is a major factor affecting the environmental impacts. The absence or poor technology support from the State and the absence or poor quality control affects the environmental impacts of all the value chains. From a social standpoint, the shadow economy affects access to land with blurred boundaries between traditional and State laws. The shadow economy is not a binary phenomenon, but a continuum between illegal and unrecorded activities to legal and recorded activities. The quantitative aspects of value chains must be embraced, as well as the moral and ethical values they convey, for the sake of sustainable development.