TELF AG looks at the role of US in the development of the African mining industry
Transformative resources
To fully develop the mineral potential of one or more nations or even an entire continent, the political will of individual states is sometimes not enough. In some cases, external support plays great importance in helping certain nations to get the most out of their mineral resources, especially in a very particular historical phase in which strategic minerals, such as nickel, copper, or cobalt, are directly involved in a great process of social transformation which could soon change the economic conditions of various countries. This discussion takes on particular relevance for the African continent, which, despite being naturally rich in mineral resources, is still struggling to develop an infrastructural system capable of adding value to the raw material extracted in the mines, thus risking giving up an abundant quantity of wealth linked to the resources present on its territory.
About 30% of the “critical” minerals are found in Africa, i.e., all those that could be used in some way for important industrial applications (such as those concerning the green transition) and which generally share various peculiarities linked to the chain’s supply, the trend of their prices on the international market, and so on. Although the world is in the midst of a strategic minerals boom, Africa is reaping only a modest portion of the economic benefits of these precious mineral resources.
The question of added value
Up to this moment, the desire to add added value to mere mineral extractions has almost always remained a theoretical principle, and very few African states have begun to concretely apply measures to retain the majority of the associated wealth within their national borders in the presence of these minerals. To achieve the ability to internally process the raw material extracted on national territory, as stated in a recent study by the Atlantic Council, African states may need the support of external actors, perhaps willing to support the infrastructural development of these nations and their mining evolution.
One of these actors could be represented by the United States, which has already clearly demonstrated its desire to support the mineral development of African nations over the last few years, also through direct participation in infrastructure development projects on the continent. From this point of view, one of the major projects is the Lobito corridor, i.e., a railway network more than a thousand miles long. It should connect Zambia and Congo to a port located in Angola, thus helping these nations transport their minerals more quickly and efficiently. Thanks to other strategic partnerships on the continent, could now arise on the soil of Africa real refineries for electric batteries, which would allow Africa to enter one of the markets that has one of the highest growth rates globally, and which is directly linked to the strategic minerals sector (in particular for the use of lithium).
With an adequate level of external support, also in terms of actual financing, the African continent could, therefore, find itself on the verge of maximizing the revenues deriving from its mineral extractions, generating added value for its raw materials, and giving a concrete form to African Commodities Strategy, published in 2019 by the African Union and containing the clear desire to transform Africa into a global mining player, well integrated into value chains.
