African Development and Europe. Report of a Seminar of the by Peter Tregear

By Peter Tregear

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The Establishment of an Industrial Complex UPPER VOLTA -•r'*·-? X. *Akosombo~~, Dam i 0 W$( Cocoa 50 Miles FIG. 1. The Volta River Project, Ghana. 53 36 African Development and Europe Aluminium production is in fact the key to this development and the aspect that makes it economically viable in the long term. There are two processes in its manufacture. First, there is the recovery from bauxite of commercially pure aluminium oxide (alumina), by means of a process that involves the use of caustic soda and of energy.

The cost of this capital expenditure is estimated in detail. Plans are made for the internal layout of the buildings and equipment, and estimates are made of the numbers of managers, technicians and workers required to operate the factory and the cost in salaries, wages, and fringe benefits. Technical specifications are laid down for the products to be manufactured and from this information together with the volume 48 African Development and Europe estimates a detailed calculation is made of the requirements and cost of raw materials.

Another facility may be access to part of the required capital through loans from a development corporation. It is our experience that incentives such as these are not offered lightly to all comers but that each case is examined on its merits, and in detail; the social and economic advantages, the effect on the balance of payments, the net gain to the country after offsetting such factors as the cost of imported raw materials, dividend payments, technical aid fees, remittance of savings by expatriate employees, and loss of revenue duty on finished goods that will no longer be imported, are all carefully weighed.

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