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- Topics
- Horizontal Linkages (Beyond Extractives)
- Assessing the Potential to Create Increased Economic Links
- Assessing the Depth of Backward and Forward Linkages
Assessing the Depth of Backward and Forward Linkages
At a Glance
- Examining a project’s backward and forward linkages is an important first step in the process of assessing the potential for horizontal linkages.
- It is important to assess the depth of backward and forward linkages (their quality, based on the degree of value added) not their breadth (the number of linkages).
- In order for capabilities to be successfully transferred, existing (forward or backward) linkages must have actually developed local capabilities and added value.
Case Studies
- Extractives Industry Local Content Early Gap Analysis (Adam Smith International)
- How to Successfully Access the Mining Supply Chain (Saskatchewan Ministry of the Economy)
Key Resources
- Mining Local Procurement Reporting Mechanism (Mining Shared Value, Deutsche Gesellschaft fur Technische Zusammenarbeit (GmbH))
- The Local Supplier Development Company Self-Assessment Tool (International Finance Corporation)
Topic Briefing
To understand the domestic skills and capabilities that are being developed by extractive industry activity, policy makers must understand the extent of goods and services that are being supplied at the local level (backward linkages) and the extent to which local industry is processing extractive projects’ outputs (forward linkages). Examples of forward linkages include refining extracted oil and cutting and polishing extracted diamonds.