Critical Minerals Can Drive Africa’s Structural Transformation

Africa holds around 30% of the world’s critical energy transition mineral reserves, placing the continent at the centre of the global shift towards clean energy. But without greater investment in processing, manufacturing and technology, Africa risks repeating its long history of exporting raw materials while importing higher-value products.

As SADC leaders meet in Durban for the 46th Ordinary Summit, critical minerals present an opportunity to turn resource wealth into industrialisation, regional integration, jobs and broader economic development.

Africa produces more than 77% of global cobalt, 65% of manganese, 83% of platinum group metals and 21% of natural graphite. SADC is central to this supply, with the Democratic Republic of the Congo dominating cobalt, Zimbabwe producing lithium, South Africa supplying platinum group metals and manganese, and Zambia remaining a major copper producer.

The International Energy Agency expects demand for critical minerals to more than triple by 2030 under net-zero scenarios, increasing pressure on major economies to secure reliable supply chains.

From Mining to Manufacturing

Minerals account for about 10% of SADC’s GDP, 25% of exports and 20% of government revenues, but provide only 7% of direct employment. This highlights the need to move beyond extraction towards processing, manufacturing and technology development.

A 2021 BloombergNEF study commissioned by the Economic Commission for Africa and partners found that a 10,000-tonne battery precursor plant in the DRC could cost about $39 million, around three times less than a comparable facility in the United States, while potentially producing fewer emissions than supply chains routed through China.

Such opportunities could allow Africa to retain more mineral value while developing technical skills, businesses and industrial capacity.

However, policy fragmentation, inadequate skills and difficulties attracting investment across borders continue to limit regional value-chain development.

Four Priorities For SADC

The region needs a coordinated strategy built around four priorities.

First, SADC should strengthen geological mapping and mineral data. Better knowledge of resource quantity and quality would improve countries’ negotiating positions and help attract investment.

Second, SADC should operate more effectively as a regional bloc by developing a minerals compact aligned with the Africa Mining Vision, SADC Regional Mining Vision, Africa Green Minerals Strategy and AfCFTA. Harmonising investment rules, royalties, local-content requirements and skills frameworks could support cross-border value chains.

Third, the region needs reliable, affordable and clean energy to power mineral processing, refining, recycling and manufacturing. SADC’s solar and hydropower resources could provide a competitive advantage as global markets increasingly demand lower-carbon production.

Fourth, mining communities must receive a greater share of the benefits. Equity participation, local procurement, skills development, environmental guarantees and transparent revenue-sharing can help ensure mining supports communities long after individual mines close.

A Window for Transformation

The Economic Commission for Africa is supporting efforts to strengthen regional value chains, improve geological mapping, attract responsible investment and address Africa’s high cost of capital.

For SADC, the growing demand for critical minerals offers an opportunity to move from being a supplier of raw materials to becoming a producer of higher-value goods and technologies.

The challenge is whether the region can act collectively and with urgency. If it succeeds, critical minerals could help power Africa’s industrialisation, create jobs and strengthen its role in the global energy transition while driving its own economic transformation.