“There is no chance of making the energy transition without Africa,” Robert Friedland, the founder of Ivanhoe Mines, who discovered the Kamoa-Kakula copper deposit in Democratic Republic of Congo (DRC), told the London Indaba conference on mineral resources, energy and mining in June last year.

Indeed, decisive resources for a low-carbon economy are abundant in Africa. The continent’s production of metals used in the manufacture of batteries, solar panels, wind turbines and other electrical networks is impressive.

DRC is the leading producer of cobalt, while South Africa is in pole position for platinum and manganese. As a whole, the continent accounts for more than half of the world’s production of these three minerals.

For graphite production, Mozambique is second and Madagascar third, according to 2022 figures (China is in the top spot), while DRC is neck-and-neck with Peru for copper, as are Guinea and China for bauxite.

Our latest ranking shows that, in each of these African countries, production of these resources rose between 2017 and 2021, the latest year for which full figures are available.

This increase is essential to meet the demand for transition minerals, which is set to more than double between now and 2030 – all the more so since COP28 in Dubai concluded in December 2023 with an unprecedented agreement aimed at a “transition away from fossil fuels”.

This ranking assesses the capacity of African countries to generate additional revenues in the mining sector by analysing changes in the production of critical minerals and government revenues over five years.

In Gabon, for example, the volume of manganese extracted almost doubled over the period under review, with an accompanying increase in revenue from the sector.

Zimbabwe and Morocco, rich in various critical metals, have also demonstrated their ability to generate revenue.

Zambia, for its part, remains a major player in the copper sector, although a decline in the cobalt sector has led to a decline in revenue.

Untapped potential

Africa’s untapped potential also appears immense. The Center for Strategic & International Studies (CSIS) think tank estimates that the continent holds 85% of manganese reserves, 80% of platinum and chromium reserves, 47% of cobalt reserves and 21% of graphite reserves.

Graeme Train, head of metals and minerals research at trader Trafigura, says: “Africa will account for 26% of the world’s production of hard rock lithium [a type of deposit to be distinguished from South American brines] by 2030.”

For the moment, only Zimbabwe produces significant volumes of lithium metal. In Nigeria and, more recently, Namibia, marginal volumes are extracted. Over the next few years, however, Mali could join our rankings, and Ghana could move up a few places thanks to its potential with this same resource.

“The entry into production of the Kabanga nickel project in Tanzania and the Enterprise nickel project in Zambia should boost Africa’s share,” says Train. With new mines, and therefore additional revenues, these two countries should see their place in our ranking change in the future. For the same reasons, this could be the case for Namibia (graphite, copper, lithium and manganese) and Botswana (copper, manganese, nickel and cobalt, in particular).

Africa’s mineral wealth is largely untapped, much of it yet to even be discovered. This is the case in new frontiers such as Angola, where Anglo-American and Ivanhoe Mines have embarked on exploration, targeting copper in particular – 6% of the world’s reserves of this mineral to have already been identified are in Africa, according to the CSIS.

But it’s also true of historic mining regions such as DRC (renowned for the high grade of its deposits), Zambia, and West Africa – a hotbed of gold production which also harbours graphite, nickel and lithium.

Unique resources

In terms of global resources, if the world needs cobalt, it will have to rely on DRC. According to our ranking, the country has had a major influence on the development of the market for this resource in recent years, as South Africa has for platinum.

As Kevin Murphy, director of mining and metals research at S&P Global, says: “Cobalt is a good stabiliser. In low-temperature environments, heavy batteries made of cobalt are more resistant. This mineral should continue to be used in batteries, at least for the next few years.”

In addition, the quality of the deposits of several minerals essential to the energy transition represents a major advantage for the continent, and one of the vectors for investment.

Ousmane Diawara, director of infrastructure project finance and mining sector expert at EY, says: “The African countries that will succeed in standing out from the crowd in the race for critical minerals will be those where the uniqueness of the resources, in terms of volume or quality, will convince investors to implement projects.”

Guillaume Pitron, an associate researcher at the French think tank Institut de Relations Internationales et Stratégiques (IRIS), says the European Union’s recent Critical Raw Materials Act (CRMA), states that “by 2030, 10% of the European Union’s consumption of critical minerals will be extracted on its territory. The rest will have to go elsewhere, which could benefit Africa”.

In this context, Africa can highlight its “long history of mining”, says Bernard Aylward, CEO of Kodal Minerals, the company developing Mali’s Bougouni lithium project.

“There are mature [mining] codes in this region, as well as an experienced workforce, consultants and subcontractors. What’s more, these are countries that are quite favourable to the mining sector,” he says. These are attractive factors, when mining projects in Europe and South America have been thwarted in recent years by popular or state mistrust.

A politically neutral hub

In addition to its resources, Africa has the advantage of a strategic location, close to Europe and Asia, with major export routes developing towards the Atlantic – and therefore the United States – such as the Lobito corridor.

“If governments manage to take advantage of the African Continental Free Trade Area [AfCFTA], this will facilitate the trade and transport of critical minerals,” says Nafi Chinery, Africa director of the Natural Resource Governance Institute.

Given that in the race for transition metals being waged primarily by China, the US and Europe, Africa has been able to maintain a more neutral position, it has thus retained a range of opportunities in which everyone can get involved.

Non-African governments are stepping up their initiatives on the continent’s critical minerals, while battery and car manufacturers are looking to take stakes in projects, and some mining companies are increasing their spending.

Barrick is investing $2bn to expand its Lumwana copper mine in Zambia, Ivanhoe Mines is quadrupling its 2024 exploration budget, particularly in DRC, and BHP has returned to Africa by taking a stake in the Kabanga nickel project in Tanzania.

At the same time, a number of African countries are strengthening their strategies for transitional minerals, in particular by promoting the mapping of their subsoil and encouraging local processing. A continental strategy for green minerals is also under discussion.

S&P Global expects spending on mine construction and expansion on the continent to reach $9.4bn in 2024, on a par with that forecast for the US/Canada and South America. While these are largely driven by the Simandou iron ore project in Guinea, Congolese copper is also well represented.

In its ‘2023 Corporate Exploration Strategies’ report, published in October, S&P Global also noted an increase in exploration budgets for copper (up 24%), lithium (up 32%) and nickel (up 133%) in Africa.

Although these are crucial to the discovery of new deposits, they represent only a tiny portion of the global budget for these minerals, with gold remaining by far the continent’s biggest exploration expense.

Risk factors

However, there are risks when it comes to exploration in Africa – security concerns, political instability, precedents of expropriation, “nationalism” in terms of resources, the business climate, banking complexities, corruption, the prevalence of armed groups.

Depending on the country and the project, the risks that can put the brakes on investment are undeniable, particularly for those who are not already familiar with the continent.

In addition, lack of infrastructure in sectors such as electricity and transport drive up the cost of operationalising mines.

According to Murphy, this is the main reason Chinese operators, who already have a strong presence in critical African minerals, are likely to remain the biggest investors in the years ahead. “Chinese groups, which are less afraid of such sums and have the backing of the state, are more likely to invest,” he says.

Good governance

To avoid losing out on investment, African governments will need to “establish or maintain a favourable climate, which includes political stability, security and transparent governance of the sector”, says EY’s Diawara. “The ability of governments to increase the socio-economic benefits of the sector at a local and national level will be crucial.”

To achieve this, it will be vital for governments to negotiate balanced contracts, develop training courses to ensure a skilled workforce, and encourage the development of a local industrial sector operating to international standards.

Good governance is key to this new mining boom, and particular attention must be paid to the involvement of local communities. They will provide the workforce needed to exploit this wealth, but can also become a powerful brake if they suffer the social and environmental consequences of an ecological transition that does not benefit them.

Methodology

Our ranking score combines two indicators: the change in market share in the production of eight critical minerals between 2017 and 2021, and the change in revenues from natural resources over the same period. We weighted these two indicators, giving 67% of the final score to the first and 33% to the second. Only countries producing at least one critical mineral from the eight assessed (bauxite, cobalt, copper, graphite, lithium, manganese, nickel and platinum) were ranked.