What determines the breadth and depth of Zambia's backward linkages to copper mining? The role of public policy and value chain dynamics
This paper investigates the dynamics of upstream linkages development to copper mining in Zambia. The breadth and depth of the local mining supply chain was deeply shaped by policies adopted in the 1990s under the Structural Adjustment Programme. These policies succeeded in attracting much-needed FDI in the mining sector, including Chinese and Indian FDI, but had a negative impact on the level of value-addition undertaken by local suppliers. In the post-privatisation era, the dynamics of the local supply chain suggest that supply firms' upgrading and sales growth were determined by firm ownership and value chain governance. In fact, forward linkages to buyers other than Chinese and Indian mining companies, and backward linkages to parent companies and technology providers were critical in supporting supply firms' success in the mining value chain.
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