How the US-led West plans to take on China in Africa in the race for critical minerals

how the us-led west plans to take on china in africa in the race for critical minerals

Worried about their vulnerability to China and Russia, the US and its allies have established a funding initiative for resource-rich African countries to bolster critical mineral supply chains essential for a clean energy transition that will challenge Chinese dominance.

Last month, the US-led group – the Minerals Security Partnership – met on the sidelines of the UN General Assembly in New York to discuss priorities, challenges and opportunities in responsible mining and processing of critical minerals.

The partnership, which was started in June in Canada, brings together the US, Australia, Canada, Finland, France, Germany, Japan, South Korea, Sweden, Britain and the European Commission.

Attending the meeting in New York were five of Africa’s mineral-rich countries: the Democratic Republic of Congo (DRC), Mozambique, Namibia, Tanzania and Zambia. The initiative promises to help African nations with funding and information to improve the domestic processing of critical minerals.

US Secretary of State Antony Blinken said at the meeting that the US and its allies were open to “providing a loan guarantee or debt financing” to countries that had abundant minerals used in electric car batteries, solar panels and wind turbines. This is part of President Joe Biden’s aim to secure minerals such as lithium and cobalt to help the US’ green energy transition – a supply chain that China dominates.

Blinken said the initiative would support projects that adhered to high environmental, social and governance standards. “We want to make this a race to the top, not a race to the bottom,” he said.

As an example he cited a mine in Balama, Mozambique, that will soon send graphite for further processing to a plant in Louisiana, to be used to make batteries for American electric vehicle manufacturers.

Guillaume Pitron, an associate research fellow at the French Institute for International and Strategic Affairs who specialises in raw materials and digital pollution, said China had the upper hand on the downstream value chain of most of the critical minerals and metals necessary for green tech.

“The US and Europe are waking up, but it is going to take time,” he said.

In Africa, “the case of cobalt is of real interest”, he added.

China now dominates the import and processing of critical minerals, especially those used to make electric vehicle batteries.

It has extensive mining interests in African countries. For instance, it sources more than 60 per cent of its cobalt needs from the DRC. And since last year, Chinese companies have made various acquisitions in Zimbabwe for lithium, which is in high demand for lithium-ion rechargeable batteries that power electric vehicles and solar panels. China also has interests in other resource-rich countries, including Zambia, Namibia and South Africa.

The US and Europe are waking up, but it is going to take time

Guillaume Pitron, French Institute for International and Strategic Affairs

Lauren Johnston, China-Africa senior researcher at the South African Institute of International Affairs, said China had had more foresight and fewer boundaries in terms of securing access in Africa. It has been investing in the DRC, Zambia and Zimbabwe and has had long-standing investments in Australia, Canada and Chile.

She said the US government appeared to be putting up money for opportunities in the critical metals market recently. For example, it is investing in battery supply chain development in Australia.

“The funny thing is that they need China; it’s not possible to exclude China in some cases. They are the only ones with the processing knowledge,” Johnston said.

“One reason that China leads in these industries is that a lot of the processing is dangerous and toxic,” she said. “China has been the country willing to bear the related industrial and environmental risks and costs.”

But overall, she said, it was a challenge to take on that type of industry because of the standards and expertise required.

In Africa, Johnston said the minerals were a “big chance” for the Southern African Development Community, a regional economic bloc of 16 member countries mostly from Southern and Central Africa. “Let us hope that they become part of that emerging global supply chain,” he said.

Alex Vines, head of the Africa programme at Chatham House, a London-based think tank, said the West would attempt to lock in supply chains or at least try to ensure that the minerals were open to the market. He said China’s behaviour regarding oil production from its state oil companies in Sudan was to go to the open market and not lock up the supply – some of which was bought by Japan.

“Western nations are reviewing what are strategic or critical minerals and how to improve their supply chains,” Vines said.

He said the abundance on the continent should give additional agency to African mineral producers, who would be able to extract better deals. “The question is, will this be just for narrow elite consumption, or will these governments use this opportunity to assist poverty reduction and promote development and jobs?” Vines said.

Russian companies have interests in coltan, cobalt, gold and diamonds in countries such as Angola, Zimbabwe, Cameroon, Ghana, Nigeria and Guinea.

According to a new study by the African Climate Foundation, the Russian private security contractor Wagner has capitalised on mineral and mining operations sales in Africa.

The report said the Wagner group used military tactics to support governments in times of conflict, and in return benefited from lucrative mining deals and special diplomatic status within countries.

“Russia plans to continue to spread its influence within the region through private military companies’ operations,” said study researchers Antonio Andreoni, a professor of development economics at SOAS University of London, and Simon Roberts, an economics professor at the University of Johannesburg.

One reason that China leads in these industries is that a lot of the processing is dangerous and toxic

Lauren Johnston, South African Institute of International Affairs

They said the African continent was becoming a battlefield in the race among superpowers to secure access to critical minerals, with companies from China and Russia playing a major role.

The study noted that the continent was endowed with large amounts of strategic critical mineral resources.

For example, 70 per cent of global cobalt production comes from the DRC, and more than 80 per cent of the world’s known platinum and manganese are in South Africa and Zimbabwe. South Africa is a leading supplier of ruthenium, iridium and rhodium, and Gabon is a major producer of manganese. Mozambique and Tanzania had significant reserves of graphite, and the DRC and Zambia were important sources of copper, the study noted.

The researchers said Washington saw China’s control over crucial mineral supply chains and dominance in rare earth metals “as two of the largest strategic vulnerabilities of the US and her allies since the Arab oil embargo-triggered energy security crisis of the 1970s”.

Jen-Yi (Jay) Chen, an associate professor of operations and supply chain management at Cleveland State University, said Western nations would and should examine the supply chains of key products and “make sure they are diversified enough to not become victims of any geopolitical tensions”.

He said Western countries’ efforts to rebuild their supply chains for critical minerals was a costly one, but it was not the only way to diversify as long as they did not put all their eggs in one basket.

He said that since Africa was mineral-rich by nature, nations “should leverage but look beyond just the short-term economic values of these minerals and seek to integrate further down the supply chains, like attracting manufacturers to invest there, for more sustainable economic prosperity”.

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