“Pacto pela Industria”

The value chains of Brazilian companies were challenged by the pandemic of COVID-19, with disruptions in the flows of investments, goods, and services. Among the dramatic examples were the lack of personal protective equipment, respirators, inputs for vaccine and medicine production, as well as difficulties in food, raw materials, and energy chains. There are also discontinuities in the supply of semiconductors, affecting several chains dependent on electronics, such as the automobile industry. They have caused not only business issues, but also social problems such as unemployment, inflation, food and energy insecurity. Thus, the problematic in global value chains (GVC) during the pandemic, exacerbating an ongoing crisis related to climate change, new technological paradigm and geopolitical conflicts, adversely impacts the achievement of the UN's Agenda 2030 in the developing world (REIS, 2021).

The Great ABC, traditional manufacturing area composed by seven cities in the metropolitan region of São Paulo, Brazil, has been being deeply impacted by GVC issues, within the context of deindustrialization. It is not only about the exit of car manufacturers, such as Ford. It is about the relations between the productive restructuring of companies and the regional economic dynamics, which even impact the public capacity to face critical situations such as the pandemic. Thus, the manufacturing value chains need to be improved to establish a virtuous dynamic of employment and income, which raises productivity, promotes social inclusion and environmental sustainability. But the first step for that would be an official agreement between many groups of interests on the importance of reindustrialization for the region. Therefore, the objective of this chapter is to describe and analyze the process for building the Industry Pact (“Pacto pela Industria”, in Portuguese), led by the Agency for the Economic Development of the Great ABC.