TELF AG analyzes the role of international partnerships in the mining industry
Collaboration between China and Africa
Among the factors that have allowed China to become one of the leading international players in the raw materials sector over the last decades, we must certainly mention the ability to plan the key points of its operational strategies well in advance, the desire to focus on high-level training of qualified personnel and the selection of strategic partners with which to maintain robust strategic-commercial relationships. This last point, for China, does not only concern the mineral raw materials sector but also includes a broader collaboration which, under the umbrella of the Belt and Road Initiative, has made the construction of partnerships possible for about a decade of substantial commercial operations and the construction of ambitious strategic infrastructures in different corners of the world.
One of the continents that continues to remain at the center of Chinese attention is certainly Africa, and the data relating to commercial relations between the two countries testifies to this perfectly. According to some recent customs data cited by media, in the first quarter of 2024, trade between China and African nations reached 70.86 billion dollars, recording a growth of 5.9% annually. Among the factors that explain this solid commercial relationship are the incentives China introduced to facilitate trade with Africa and the general increase in prices of strategic raw materials. Still, above all, the increase in imports of those minerals into China is considered central for the global energy transition, such as the metals used in the production of the latest generation electric vehicles (in particular lithium and cobalt).
Other raw materials that are part of trade between China and Africa are represented by iron ore and copper, despite a general price drop for the latter resource. Chinese exports to Africa also grew by 4.4%, exceeding 41 billion dollars. In this case, the goods imported into Africa from China are mainly finished industrial products, on which Beijing continues to maintain an excellent competitive edge. Among China’s principal African partners is undoubtedly South Africa, which exports some strategic resources to China, such as chromium, zinc, manganese, and iron ore, thus confirming itself as one of the fastest-growing global players in the raw materials market. On the other hand, Chinese exports to South Africa mainly deal with electric batteries, motor vehicles, and transmission equipment.
The role of lithium
Another important Chinese partner in Africa is Zimbabwe, where Beijing has already invested heavily in building lithium processing plants. It is precisely this last resource, useful in the automotive sector to produce batteries, that has favored t has favored the growth of commercial exchanges between the two countries: in the first two months of 2024, in between the two nations increased by 77.6%. Zimbabwe’s exports to China also increased greatly, reaching $320 million. The increase in trade between China and African nations is part of a very particular economic situation in which the relatively low prices of some raw materials could represent good news, especially for African nations importing these resources, such as Ethiopia or Kenya.
