MODELING THE ECONOMIC-IMPACTS OF FURTHER MINERAL PROCESSING - THE CASE OF ZAMBIA AND MOROCCO

Although the question of the further processing of mineral commodities for export in developing countries has often been analysed, few concrete answers have appeared. This study examines the potential impact of further mineral processing activites on industry linkages and growth prospects for copper in Zambia and for phosphates in Morocco. Following an evaluation of the processing argument, a modified static input-output framework is presented, suitable for the analysis of processing activities in developing countries. The empirical results obtained agree well with the theory regarding likely multiplier impacts. This study does not suggest that there is one best processing policy; rather it identifies several processing alternatives that result in substantial economic gains over previous production activities. The results thus suggest that given the right combination of domestic conditions, gains from trade are likely to follow from expanding processing capabilities as well as from improving related processing technologies.