Southern Africa’s Critical Mineral Potential
As global demand for clean energy technologies accelerates, Southern Africa‘s abundant critical mineral reserves have become increasingly vital to the energy transition, according to reports from the World Economic Forum. The “Financing Southern Africa’s Clean Power and Critical Minerals” report reveals the region holds about 30% of the world’s critical-mineral resources, including copper, cobalt, lithium, graphite, manganese, chromium, vanadium and platinum-group metals.
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The analysis, developed in collaboration with the Development Bank of Southern Africa (DBSA) and McKinsey & Company, examines value chains across ten Southern African countries: Angola, Botswana, the Democratic Republic of Congo, Madagascar, Mozambique, Namibia, South Africa, Tanzania, Zambia and Zimbabwe. Sources indicate these resources could significantly boost regional economic development if properly leveraged.
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Investment Gap Despite Massive Potential
Despite this substantial mineral wealth, analysts suggest investment levels remain critically low. The report states Africa’s exploration spending in 2024 reached only $1.3-billion, representing just 10.4% of total global spending, with Southern Africa‘s share even smaller. Compared with global peers, Southern African countries reportedly have higher reserves-to-production ratios for most minerals except lithium, indicating greater untapped extraction potential.
“Southern Africa holds vast reserves of critical minerals, yet current investment levels fall short of the region’s potential. Unlocking this potential is essential not only for advancing inclusive growth across the region but also for strengthening the resilience of global supply chains critical to the energy transition,” said Jörgen Sandström, head of the WEF’s Transforming Industrial Ecosystem programme, according to the report.
Key Barriers to Financing
The analysis identifies eight core financing barriers affecting Southern Africa’s critical minerals development: policy uncertainty, investment risks, energy access constraints, transportation barriers, lagging innovation, slow industrialization pace, skill gaps and demand volatility. These challenges have contributed to declining exploration activity across the continent, with South Africa accounting for only about 1% of total global exploration.
Minerals Council South Africa CEO Mzila Mthenjane argued that reversing this trend requires digitizing geological data, making exploration rights applications quicker and more transparent, and ensuring policy certainty. “We need to be deliberate in our policy, and we need to be intentional in our actions… as host to capital in South Africa; I think that’s how we’ll be able to increase the investment that we need,” Mthenjane stated during the report’s launch.
Solutions and Regional Initiatives
The report highlights several replicable solutions already showing success in the region. The Lobito Corridor initiative, a railway-focused project linking mineral-rich regions of the DRC and Zambia to Angola’s Port of Lobito, is cited as a promising example of cross-border collaboration. Supported by the EU, US, Angola and the DBSA, the project includes upgrades to existing rail lines and a planned 800 km extension to ease transportation bottlenecks.
Zambia’s mining policy reforms also receive attention, with new legislation reportedly boosting investor confidence and promoting greater local participation. Copper production in Zambia is expected to reach one-million tonnes by 2026, with a national target of three-million tonnes by 2031, according to the analysis.
De-risking Investment Strategies
Mandela Mining Precinct executive director Julie Courtnage emphasized that de-risking investment in critical minerals requires research investment to remain “future facing” and better manage emerging risks. She highlighted the importance of establishing partnerships and investing in governance structures to ensure responsible mining practices.
“Return on investment is not only about your capital invested and the interest and the returns; it’s whether what you’re investing in is going to create more liabilities than returns. So, put that longer-term lens on and have a more systemic view of your investments as you are pursuing critical minerals,” Courtnage advised.
Integrated Value Chain Approach
African Union Development Agency CEO Nardos Bekele-Thomas discussed the importance of integrated value chain financing, noting that capital inflows should build sovereign and resilient economies rather than simply extracting resources. “If you want to finance a mine, your proposal must include financing for the local processing plant, [and] the business case for a solar plant should be linked to powering a local industry, not just feeding the grid,” she argued.
The approach aligns with broader global initiatives like the European Union’s Critical Raw Materials Act, which seeks to secure sustainable mineral supplies while supporting local development. DBSA CEO Boitumelo Mosako warned that if extraction continues to be characterized by raw material exports with limited local beneficiation, Africa risks missing another opportunity to convert mineral wealth into structural socioeconomic transformation.
As global technology firms develop advanced solutions for various industries, from automated cleaning systems to AI cloud platforms and voice-controlled AI tools, the demand for critical minerals continues to grow. Meanwhile, financial markets remain attentive to sector developments amid broader economic concerns, while cybersecurity innovations like AI-powered security tools highlight the technological transformation driving mineral demand.
According to the report’s conclusions, unlocking Southern Africa’s critical mineral potential will require coordinated efforts across public and private sectors, with cross-border collaboration being particularly essential for scaling clean energy and critical minerals development throughout the region.
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