From Regulation To Equity: Africa’s Critical Minerals Landscape

Africa stands at a pivotal moment in the evolution of the global mining industry. The continent holds a significant share of the minerals required to power the energy transition, yet it continues to capture only a small portion of the value derived from these rich minerals. The shift from regulation to equity represents a structural rethinking of how mineral wealth is governed, developed and ultimately shared.

At its core lies a tension between sovereign control and commercial reality. African governments have long held the legal authority to regulate mineral extraction, yet for decades this authority translated into limited economic participation beyond royalties and taxes. The global transition to clean energy has changed that calculus decisively. Demand for critical minerals is projected to rise sharply over the next two decades. With Africa accounting for approximately 30% of global reserves, the strategic importance of these resources has never been greater.

The question is no longer whether African states will assert greater control over their mineral endowments, it is whether they will do so in a way that unlocks real value without deterring the capital and expertise required to develop these resources.

Minerals, power and the midstream gap

Despite its resource abundance, Africa remains largely excluded from the most lucrative segments of the mineral value chain. While countries such as the Democratic Republic of Congo ("DRC"), South Africa and Guinea dominate the production of cobalt, platinum group metals, manganese and bauxite respectively, the processing and refining of these materials remains overwhelmingly concentrated outside the African continent.

China, for example, has established a dominant position in the midstream segment, refining the majority of the world’s rare earth elements and controlling a substantial share of lithium and cobalt processing capacity. This dominance was built over decades of sustained policy support, infrastructure investment and strategic international partnerships.

The commercial implications are significant. The value uplift between raw and processed materials is considerable: iron ore converted into steel can increase in value several times over, while the transformation of bauxite into aluminium offers an even greater uplift. Every tonne exported in raw form is a downstream gain forgone and jobs not created, industries not built and revenues not earned.

“Equity” in this context therefore extends beyond ownership or taxation. It encompasses participation across the entire value chain, from extraction to processing, manufacturing and ultimately marketing. The aspiration is not merely to extract minerals, but to industrialise through them.

From aspiration to regulation

The African Mining Vision, adopted by the African Union in 2009, is the continent’s overarching policy framework for mineral resource governance. Its key pillars are the transparent, equitable, and optimal exploitation of mineral resources to underpin broad-based sustainable growth and socio-economic development. The objective is that Africa’s mineral resources should drive broad-based development and industrialisation. For many years, however, this remained largely aspirational.

More recently, a discernible shift has occurred. A number of African jurisdictions have begun to translate these principles into binding legal frameworks aimed at promoting beneficiation, local ownership and in-country value creation.

Nigeria's House of Representatives, for example, has passed the Raw Materials Research and Development Council Amendment Bill, which mandates a minimum of 30% value addition to raw materials before export, backed by a 15% levy on non-compliant exports. South Africa's Mineral Resources Development Bill, 2025 proposes to enhance provisions relating to the beneficiation of minerals and introduces a mandatory regime obliging every producer to make minerals or mineral products available for local beneficiation. In Ghana, the Green Minerals Policy adopts a "no raw export" stance for certain minerals, while the establishment of a centralised gold trading authority has consolidated control over the domestic gold value chain. Each approach is different, but the direction of travel is the same.

The DRC offers perhaps the most striking illustration. The DRC declared cobalt, germanium and columbite-tantalite as strategic minerals under a Ministerial Decree, raising the applicable royalty rate to 10% from 3.5%. In February 2025, the government went further, imposing an outright export ban on cobalt. When that ban disrupted supply chains and prompted force majeure declarations from major mining companies including Glencore, it was lifted in October 2025 in favour of annual quotas designed to stabilise global supply and prices while still asserting sovereign control.

Governments are moving beyond passive regulation towards more interventionist strategies designed to capture greater value from their resources.

Legislation alone cannot deliver industrialisation. Beneficiation requires capital-intensive infrastructure, reliable energy supply, skilled workforce, access to technology and a competitive operating environment. Without these enabling conditions, regulatory mandates risk remaining aspirational.

The limits of export controls

Export bans and restrictions have emerged as a prominent policy tool in several jurisdictions, often justified as a means of supporting domestic processing industries. In theory, limiting exports of raw materials can reduce domestic input costs and incentivise investment in downstream facilities.

In practice, the effectiveness of such measures depends on a range of factors that are not always present in African contexts. These include access to affordable and reliable power, established logistics networks, availability of financing and resilience to potential trade retaliation.

Indonesia is frequently cited as a successful example of export-led industrial policy in the mining sector. However, its experience is underpinned by specific advantages, including low-cost energy, existing infrastructure and the ability to attract large-scale foreign investment in smelting capacity. Replicating these conditions elsewhere is far from straightforward.

There is growing recognition that alternative policy instruments, such as targeted incentives or calibrated export taxes, may achieve similar objectives with fewer unintended consequences. The challenge for policymakers lies in designing frameworks that encourage beneficiation without undermining investment.

The importance of coordination

No single African country, regardless of its mineral wealth, has sufficient market power to reshape global supply chains independently. Fragmentation risks creating competitive disadvantages, as jurisdictions compete for investment by offering increasingly favourable terms.

Regional coordination offers a pathway to greater collective influence. Continental and sub-regional frameworks such as the African Mining Vision, Africa Green Minerals Strategy, the African Continental Free Trade Area and various industrialisation strategies aim to promote integration and harmonisation across markets.

Practical examples are beginning to emerge. The DRC-Zambia partnership on battery minerals represents an effort to develop cross-border value chains, leveraging complementary resource bases and shared infrastructure. Similarly, Botswana’s long-standing partnership with De Beers illustrates how negotiated arrangements can evolve over time to increase local participation while maintaining investor confidence.

However, the gap between ambition and implementation remains significant. Building integrated value chains across borders requires alignment of policy, infrastructure investment and political will, all of which are often in short supply.

Geopolitics and shifting investment assumptions

Historically, investment decisions were primarily shaped by geological, operational and regulatory considerations. Today, geopolitics has become the defining force shaping mining regimes globally, transforming how governments regulate, invest in and control mineral resources. Geopolitical alignment and state-to-state agreements are becoming equally influential.

Bilateral arrangements between states are reshaping supply chains and, in some cases, altering existing commercial relationships. This raises complex questions regarding the stability of contractual arrangements and the enforceability of rights in an environment where political considerations may take precedence.

In parts of West Africa, resource nationalism has taken a more confrontational form. Niger's military government assumed full control of Orano's uranium mine in June 2025 and subsequently nationalised the country's only industrial gold mine, while suspending exports of precious and semi-precious stones. In Guinea, a number of mining licences were revoked in May 2025 with limited public explanation. These actions, while often driven by domestic political imperatives, have implications for investor confidence and capital allocation.

At the same time, new entrants are emerging in jurisdictions where traditional investors are withdrawing. This evolving landscape underscores the need for investors to assess geopolitical risk with the same rigour as other project risks.

The risk of a “green resource curse”

The energy transition presents an opportunity for Africa to redefine its role in the global economy. However, it also carries the risk of perpetuating existing patterns of inequality and underdevelopment.

The concept of a “green resource curse” reflects this concern. Without robust governance, the extraction of critical minerals may replicate the dynamics historically associated with fossil fuels, including weak local benefits, environmental degradation and social challenges.

In certain regions, issues such as informal mining, limited traceability and the presence of armed groups continue to undermine responsible sourcing efforts. While international standards and due diligence frameworks have improved transparency, their effectiveness is often constrained by what can actually be enforced on the ground.

Striking a balance between raising standards and ensuring inclusivity, particularly for artisanal miners who depend on the sector for livelihoods, remains a critical challenge.

What is holding beneficiation back?

Despite strong policy momentum, beneficiation across much of Africa remains limited. The constraints are well understood. Reliable and affordable energy remains a fundamental requirement for processing industries, yet power shortages persist in many mineral-rich regions.

Transport infrastructure, including rail and port capacity, is often insufficient to support large-scale industrial activity. Water scarcity in certain jurisdictions adds an additional layer of complexity.

Institutional fragmentation further complicates the operating environment. Overlapping mandates between regulatory bodies can result in delays, uncertainty and increased costs for investors. Addressing these challenges requires coordinated policy implementation, regulatory clarity and sustained investment in enabling infrastructure.

Importantly, competitiveness must remain central to any beneficiation strategy. Mandates that are not aligned with economic realities risk deterring investment and delaying project development.

Looking ahead

The next decade will be decisive for Africa’s mining sector. Several key questions will shape the trajectory of the continent’s critical minerals landscape.

Will beneficiation policies translate into tangible industrial capacity, or remain largely aspirational? Can regional partnerships evolve into fully integrated value chains, or will national interests prevail? How will the balance between sovereignty and investor certainty be managed in an increasingly geopolitical environment?

The answers will determine whether Africa’s mineral endowment becomes a catalyst for sustainable industrialisation or perpetuates the historical model of raw material exports.

Achieving the former will require more than regulatory change. It will demand a holistic approach that integrates policy, infrastructure development, investment facilitation and capacity building. It will also require constructive engagement between governments, investors and other stakeholders to align interests and build durable partnerships.

The shift from regulation to equity is underway. The challenge now is to ensure that it delivers meaningful, lasting value for the continent.

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