THAPELO MOAMOGOE

The global race for critical minerals has accelerated sharply over the past decade, driven by the energy transition, electrification, digitalisation and rising geopolitical competition.

According to the International Energy Agency, projects that demand minerals essential to clean energy technologies could rise two to sixfold by 2040, depending on the ambition of climate policies. This anticipated surge has transformed critical mineral strategies from a niche policy issue into a central economic and security priority.

Africa sits at the centre of this shift. The continent holds an estimated 30% of global mineral reserves, including dominant shares of:

platinum (over 70%),
palladium and rhodium (over 40%),
manganese (over 40%),
cobalt (around 70%),
chrome (70%) and
significant endowments of copper, titanium, bauxite, lithium, rare earth elements and vanadium.

Despite this, Africa captures less than 10% of global mining value-added, underscoring the persistent gap between resource endowment and economic benefit.

Global demand remains the dominant driver of investment.

Against this backdrop, African countries are increasingly seeking to redefine what “critical minerals” mean, not through the lens of import dependence, but through development impact.

In the main, critical minerals lists are typically defined by supply risk and industrial vulnerability. The EU currently lists more than 30 critical minerals, while the US updates its list every three years based on defence, manufacturing and technology needs.

Africa’s emerging definition is strategic. It places emphasis on:

minerals that anchor industrialisation and beneficiation;
inputs critical to energy systems, transport and agriculture; and
resources that can support regional value chains, not just exports.

This reframe is visible in national strategies. Countries such as South Africa, Namibia, Zimbabwe, the Democratic Republic of the Congo, Zambia and Ghana have all updated or signalled updates to mineral and industrial policies to explicitly link mining to downstream processing, localisation and manufacturing.

Global demand remains the dominant driver of investment.

However, Africa’s policy challenge is aligning this demand with domestic priorities. Historically, mineral exports have accounted for 60%-80% of exports in many resource-rich African economies, while downstream processing has remained limited.

Redefining critical minerals allows governments to shift negotiations with investors and trading partners from access to resources alone towards broader economic participation.

If the continent gets the reframe right, the economic upside is significant. Downstream processing can increase the value of mineral exports and can be multiplied between two and 10 times, depending on the stage of beneficiation.

Critical minerals are exposed to global price volatility and technological substitution.

That said, the risks involved with a focus on critical mineral beneficiation are substantial and cannot be overlooked. Processing facilities are capital-intensive, energy-hungry and sensitive to scale and technology. Refining lithium, copper or rare earths requires stable electricity, water security, logistics infrastructure and skilled labour — constraints that remain binding in parts of the continent.

There is also market risk. Critical minerals are exposed to global price volatility and technological substitution.

Africa’s strategic opportunity lies in broadening the definition of critical minerals beyond headline commodities. Copper, manganese, graphite, phosphate rock, potash, vanadium and industrial minerals play critical roles in power systems, fertilisers, steel and manufacturing.

Fertiliser minerals, for example, directly affect food security and import substitution. Manganese and vanadium underpin grid-scale energy storage and steelmaking, offering longer-term demand resilience.

A diversified critical minerals framework reduces exposure to hype cycles while strengthening domestic industrial linkages.

Banks can accelerate the shift from ore to industry by financing smelters, refineries, precursor facilities and mineral-based manufacturing.

Energy reliability, rail, ports and corridor infrastructure determine whether beneficiation is competitive. Banks play a critical role in structuring blended-finance models and private-public partnerships to fund this backbone.

By prioritising financing that supports value addition, regional supply chains and local content, banks help ensure that mineral wealth supports inclusive economic growth rather than short-term export revenue.