Assessing impact of a mineral project on the economy of a developing country - Part 1: input-output models

The impact of a mineral project in a developing country is evaluated in the broad context of its economy using input-output models. Minimum economic theory is used to develop simple numerical models. Sets of technical coefficients are exploited in the development of linear models of the productive element of an economy. The analysis allows assessment of the overall economic consequences of a mineral development in which issues broader in scope than financial objectives need to be incorporated in the evaluation. In part 1, the framework for the development of the input-output model is presented. The model is refined to incorporate country-specific behaviour. The increased flexibility of the enhanced semi-input-output model permits a more confident investigation of the economy-wide effects associated with a new project in the mineral sector of a developing country. The relevance of the models is illustrated using an example from Namibia