Lack of processing industry for primary commodities
Name(s):
Lack of vertical economic diversification
Incidence
[Developing countries] Since nominal tariff rates increase with the degree of processing, and since there is a long-standing vertical integration of industry (often with transnational corporation involvement) that already has control of all or most processing, developing countries have difficulty increasing their national participation in processing. In addition, absence of capital and technical knowledge leaves little for developing countries to attempt development on their own in these areas.
Aggravates
Strategy(ies)
Value(s)
Type
(D) Detailed problems