The Opportunity for Africa presented by the Scramble for Critical Minerals

Paul Collier
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Paul Collier: Blavatnik school of government, FERDI - Fondation pour les Etudes et Recherches sur le Développement International

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Abstract: Underlying the new international concern about Critical Minerals and Rare Earths is the belated recognition of a serious security threat from China. Under President Xi, a new style of aggressive international diplomacy has been adopted, using threats of export bans and debt foreclosure as bargaining tools. Over the past decade, Chinese businesses, now effectively controlled by the government, have quietly bought up rights to a large majority of some minerals that are currently crucial inputs into batteries. In parallel, China has invested in the capacity to process these minerals and now controls around 90% of global capacity. In response, Europe, the USA and Japan are all seeking to protect themselves by searching for these minerals in Africa, which has some of the most promising geology. Analogously to China, they may also be interested in African processing of them, especially since such processing in their own jurisdictions is liable to be delayed by the need to revise environmental regulations. In combination, these belated protective efforts, and the inevitable reactive responses by the Chinese to consolidate their involvement in Africa, has driven up the prices of these minerals while creating another "scramble for Africa". Beneath the current hype, the scale of the eventual benefits for Africa will depend upon strategic long-term thinking, since the export bonanza itself is likely to be modest. Price rises are unlikely to be sustained, and volumes are likely to be modest.

Keywords: Africa; Natural resources; Critical minerals; Natural resources management (search for similar items in EconPapers)
Date: 2025-12-19
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