View / Africa is grappling with how to benefit from the minerals boom

No single issue will affect African nations’ economies this year — not trade, not geopolitics, not elections — more than the fortunes of the global mining sector.

The wild price swings we’ve seen over the past week only serve to hammer home how the continent could ride a commodity boom, or be wrecked by a commodity bust. The world’s wealthiest nations are scrambling for access to metals and minerals buried underground in Africa in order to safeguard their economic and geostrategic interests, from gold to protect against Washington’s erratic trade policies to copper needed for the AI boom. But have African policymakers identified ways to retool their industries, and their economies, to benefit from this supercycle?

I’m in Cape Town for the Mining Indaba, Africa’s biggest annual mining conference, where I’m hoping to get some answers to this central issue of how the continent’s mineral-rich nations can make the most of their natural resources. The moves being made by policymakers and mining companies could define the course of some African economies for the next few decades.

This issue is particularly pertinent in light of Washington’s attempt to form a trade zone for critical minerals to counter China’s dominance of the sector. The plan involves creating a price floor for critical minerals to reassure investors. It would make it easier to extract the minerals needed for batteries and defense equipment, by removing the risk of price volatility. That’s great news for international investors. But there’s no suggestion that this move would help African producers to overcome the bottlenecks, such as poor energy infrastructure and high financing costs, that hold back attempts to add more value locally.

The continent’s top commodity exporters — such as DR Congo, the world’s largest source of cobalt, and iron ore producer Ghana — all repeat the same mantra: They want to add more value locally by processing and manufacturing. Yet it remains unclear how African countries will benefit in a way that creates jobs and develops local expertise to drive their economies.