Africa’s Critical Minerals: From Resources to Industrial Power|PACT

As climate change accelerates and fossil fuels lose ground, the global economy is racing toward a cleaner, low-carbon future. This transition is reshaping markets and supply chains. Countries are retooling industries to produce electric vehicles, solar panels, wind turbines, and large-scale batteries. All of these technologies rely on one foundation: critical minerals. Lithium, cobalt, rare earth elements, graphite, nickel, manganese, and platinum-group metals (PGMs) form the backbone of the green economy.

Africa’s producing economies hold some of the world’s most important deposits. The Democratic Republic of Congo supplies over 70 percent of global cobalt output. South Africa is estimated to hold around 80 percent of known PGM reserves, essential for hydrogen technologies. Zimbabwe ranks among Africa’s leading lithium producers, while Mali’s Goulamina mine, commissioned in 2024, positions the country as a rising player in West Africa, alongside new projects in Namibia. Mozambique and Madagascar are emerging as key graphite suppliers, and rare earth exploration is advancing in Angola and Tanzania.

These endowments place Africa at the center of the clean energy transition. Yet holding the minerals is not the same as holding the value. The continent’s position is therefore both powerful and precarious:

Fewer than 5% of critical minerals are refined or processed locally, meaning most revenues and jobs are created overseas.
Power shortages and weak transport networks hold back industrial growth.
Skills gaps in engineering and green technologies slow the move from extraction to higher-value industries.

Geology alone does not guarantee development. Without infrastructure, skills, and investment in value addition, resource-rich states risk remaining suppliers of raw ores while industrial gains accrue elsewhere.

Governments as Enablers and Regulators

Governments, as custodians of mineral wealth, are beginning to shift from raw exports toward policies that emphasize beneficiation and industrial development. Their role is to secure transparent contracts, regulate effectively, and ensure that local communities benefit from mining activity.

Recent policy shifts illustrate this momentum:

Burkina Faso adopted a new Mining Code (Law No. 016-2024/ALT) and Local Content Act (Law No. 017-2024/ALT), mandating beneficiation and creating a framework for joint ventures in lithium and rare earths through state firm SOPAMIB.
Zimbabwe banned the export of raw lithium to stimulate local refining and battery production.
Namibia is combining licensing for green hydrogen projects with incentives for mineral beneficiation.
The African Union is advancing a continental strategy on critical minerals to harmonize rules and capture more value regionally.

Yet announcements are only the first step. The real test lies in implementation. Reliable infrastructure, long-term investment, and skilled workforces will determine whether reforms move beyond paper. Without enforcement, beneficiation policies risk becoming symbolic, echoing the missed opportunities of past oil and gold booms.

Private Sector: The Engine of Industrialization

Private capital often moves faster than public budgets, driving innovation and scaling projects. Global investors are positioning themselves in Africa’s critical minerals economy. KoBold Metals, backed by Bill Gates and Jeff Bezos, is expanding in the DRC with rights for copper, cobalt, and lithium exploration. In Mali, Ganfeng Lithium acquired Leo Lithium’s 40 percent stake in the Goulamina project, while the state increased its share under a new mining code.

Local champions are also emerging. African Rainbow Minerals operates across PGMs and ferrous metals in South Africa. In Zimbabwe, firms are investing in downstream capacity to comply with export bans. In Tanzania, graphite projects such as Mahenge are moving toward refining and processing capability.

For African investors, the challenge is to move beyond extraction. Expanding into refining, processing, and technology partnerships will be essential to capture greater value. Collaboration with universities and startups can foster innovation, while adherence to credible ESG standards will improve access to global buyers. Special economic zones, predictable regulation, and public–private partnerships can accelerate progress. Without deeper local engagement, the trajectory of Africa’s mineral economy will continue to be shaped largely by external actors.

A Forward-Looking Opportunity

Critical minerals are about more than geology. They are about jobs, industrial capacity, and economic sovereignty. The sector is labor-intensive, creating opportunities across mining, refining, logistics, research, and technology services. For producing economies, the stakes are transformative. For the wider continent, regional trade and integration can spread benefits.

With Africa’s youth population projected to double to 830 million by 2050, the need for large-scale job creation is urgent. A well-managed minerals sector could generate skilled employment, expand fiscal space for health, education, and infrastructure, and anchor new industries in clean tech, advanced materials, and supply-chain services.

But if countries remain dependent on raw exports, they will capture only a fraction of this opportunity. The International Energy Agency (IEA) estimates that the global critical minerals market could reach USD 770 billion annually by 2040 under net-zero scenarios. The gap between exporting ores and exporting refined products could translate into tens of billions of dollars in lost revenue each year.

The choice is urgent. For producing economies, the next decade will determine whether mineral wealth translates into industrial power. For the continent, integration through the African Union and the AfCFTA will decide whether this transition delivers prosperity or deepens inequality.

The race for critical minerals is now about policy, ownership, and execution. Whether Africa holds not just the reserves, but also the value, will determine if the energy transition becomes a catalyst for shared prosperity or another missed opportunity.

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