Despite huge contributions by the mining sector to foreign exchange earnings of many African countries, output falls short of real potential, reflecting scarcity of capital for operations.

A Development Report issued by the African Development Bank on the continent for 2001 made available to the Ghana News Agency said most African countries lack the other inputs required for the development of strong and broadly based metals industry.

"Accordingly, integration is essential for the development of an industrial base that will attract mining investment."

The Report said the economies of Botswana, Namibia, Zambia and the Democratic Republic of Congo (DRC) are driven by the performance of the industry.

Diamonds provide 30 per cent of GDP in Botswana, 50 per cent of government tax revenues and 75 per cent of foreign earnings. In Namibia, diamonds account for 30 per cent of export earnings.

Gold is the largest foreign exchange earner for Ghana at around 30 per cent of the total while in Zambia copper exports provide 80 per cent of foreign earnings.

On output, the Report said while Africa has 50 per cent of known world bauxite reserves, it delivers less than 15 per cent of world bauxite output.

Similarly, with 53 per cent of the world's manganese reserves, it produces only 33 per cent of the manganese sold on the market.

The Report said the significance of the mineral deposits is fast diminishing noting that in 1976, Africa accounted for 61 per cent of world gold output, but by 2000 its share had slumped to 23 per cent.

Ghana, Africa's second largest producer, accounts for just three per cent of world output. This is under further threat as harsh market dynamics continue.

Zimbabwe's market share is only one per cent.

Output in all these countries is nowhere near their 1970's levels.

The Report said a similar decline in production is evident in copper.

Zambia and the DRC are currently producing 260,000 tonnes and 30,000 tonnes respectively - down from 500,000 tonnes and 356,000 tonnes 30 years ago, with enormous reserves still untapped.

In 2000, developments in global prices for metals varied considerably with gold price stabilizing while the prices of other metals recovered. GNA