An Economic Analysis Of Conversion To Coal-Fired Cement Kilns In The Philippines And South Korea

The lesser developed countries (LDC's) may be classified into two categories: 1) oil producers, and 2) non-oil producers. The non-oil producing LDC's, as a class, are at present in very difficult financial straits. (1) Since the quadrupling of world market crude oil prices in 1972, an ever greater share of the LDC's export earnings have gone to pay for oil imports, in-stead of national reinvestment. The LDC's inter-national debts--much of it to pay for oil--have soared to record levels, with consequent limits for future credits. (1) Again, this inhibits future national investments, and there does not seem to be an end to the future increase of Organization of Petroleum Exporting Countries (OPEC) prices. Indeed, some of the economic difficulties in some metal markets--particularly the imbalance of production vs. markets for copper, can be traced indirectly to the OPEC cartels' heavy-handed impact on copper producing LDC's which must produce copper at any price to meet their oil bills. (2) Among the major oil importing LDC's are the Philippines and South Korea. 50th nations have substantial cement industries. The South Korean industry is geared for major export markets in the Far East. Both nations have ambitious plans for economic growth in order to accommodate burgeoning populations with ever increasing expectations for high standards of living. These plans had some success, more or less, until the high OPEC oil cartel charges had to be borne. Now, in common with all oil-deficit areas, the Philippines and South Korea are seeking lower cost sources of energy. Both countries have coal deposits. In the case of the Philippines, the reserves are in scattered, relatively small deposits. Most of the coal deposits are faulted, folded and, in general present formidable production problems for limited reserves. Nonetheless production has been on the order of about 70,000 to 150,000 tons per year in the last 30 years. Prior productions (1920-1941) varied between 9,000 Co 150,000 tons per year. (13)