The graph in Fig. 4 shows the value of visible and invisible exports for Country A for 2011–2016. [Figure 4] Use the information in Fig. 4 to help you answer the following questions.

Mark scheme

Marking points from the official mark scheme (Oct/Nov 2017). The mark or mark type is shown in brackets.

1. [1] Visible exports are exports of goods
2. [1] such as tea/cars
3. [1] Invisible exports are exports of services
4. [1] such as banking / insurance / teaching / health.
5. [1] 2012
6. [1] Total exports = $8 billion
7. [1] Total imports = $6.5 billion
8. [1] Balance of Payments = $1.5 billion
9. [1] In the short-term, the development of the mine will need capital expenditure on machinery
10. [1] and the establishment of a suitable infrastructure
11. [1] it may also need expertise in mining engineering that may not be available in the country
12. [1] this would have a negative effect on the Balance of Payments
13. [1] Some of the machinery and expertise would have to be imported
14. [1] this would have a negative effect on the Balance of Payments
15. [1] There should be more exporting of surplus ore / products made from the ore
16. [1] improving the Balance of Payments
17. [1] There will be less need to import iron ore
18. [1] improving the balance of payments
19. [1] Rail
20. [1] Road
21. [1] Canal / river / waterway
22. [1] A multinational mining company would have the experience and expertise of successfully developing new mines.
23. [1] The capital necessary to develop the mine would come from the resources of the multinational.
24. [1] The multinational would employ many local workers, particularly in the less skilled jobs.
25. [1] Many local firms would benefit from the multinational entering into contracts with them. For example, there would be catering contracts and some raw materials, such as wood props, would be obtained locally.
26. [1] The multinational would pollute the country, and the government would have to put in place strong environmental regulations to force the multinational to minimise pollution.
27. [1] Senior management would probably be brought in from head office, and the government would have to ensure that local workers are trained for the senior jobs.
28. [1] There would have to be strict controls in place to ensure the multinational paid fair taxes, and did not move all its profits overseas to minimise tax.
29. [1] If the government has the expertise in the country to develop and run the mine, then it would be recommended not to allow the multinational to own it.
30. [1] However, many countries do not have this expertise or the necessary capital to start the mine. In these circumstances the multinational may be allowed to own it, but subject to suitable controls being agreed with the government.