This paper contributes to debates regarding the lack of theorization of the state and the over-emphasis on lead firms in studies of global value chains (GVCs) and global production networks (GPNs). This paper combines the GVC/GPN frameworks with a strategic-relational approach (SRA), a SRA conceptualization of the developmental state, and literature about the embeddedness of firms. Empirically, the paper analyzes the conflictual relationship between firms and the state’s strategies that structure and re-structure the development, industrial policy regime, and GVC/GPN integration of the Ethiopian leather and leather products industry.