Abstract

The global value chain has become an important strategy to link local suppliers to the various commercial activities that are performed during the production of goods and services. The chain actors involved join together in distinctive processes to produce a product in a win-win situation. This means that even the marginalized local suppliers are given an opportunity to supply along the chain and earn income. However, due to the complexity nature of the value chains, local suppliers continue to face challenges to derive some benefits from the chains due to unknown barriers. The objective of this study was to find out the major barriers that suppliers face in the mining global value chain in Zambia. The analysis was based on survey data set obtained from 350 purposively sampled suppliers who are members of the mining suppliers and contractors association of Zambia. Exploratory factor analysis was used to find the barriers affecting suppliers in the mines. The results revealed public and private sector barriers as well as individual supplier capacity barriers. The study also presented some major policy implications for the mining global value chain in Zambia. In addition, the study proposed areas for further research to be done on a broader data set from other mining areas in other countries to validate the findings of this study. Key words: Global value chain, suppliers, mines, small, medium enterprises. &nbsp

Highlights

  • The mining sector worldwide creates employment directly and indirectly through its global value chain activities

  • This study was undertaken produce a common framework of barriers affecting suppliers to supply to the mines

  • This study investigated the supplier barriers in the mining global value chain in Zambia

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Summary

Introduction

The mining sector worldwide creates employment directly and indirectly through its global value chain activities. The global value chain (GVC) covers the full range of activities performed by various firms to bring a product from its inception to the end user and beyond (OECD, 2013a). The costs and benefits of the mining global value chain to local communities and the relationship between them are subjects that have become important in developing and developed countries (IFC, 2002; OECD, 2013b). Most countries have witnessed sustainable benefits between communities that provide services to the mines (IFC, 2002). In Canada as well as Malaysia, small and medium enterprises (SMEs) who are linked to the mining activities have become global suppliers as they have participated and adapted to international requirement (Ata, 2013).

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