Indaba: New Cold War for minerals tests Africa’s ability to leverage huge resources

Africa’s vast critical-mineral endowment has thrust the continent to the centre of intensifying rivalries between the United States, China and other powers, but its future will depend more on governance and strategy than on geology, speakers at the Mining Indaba said.

The continent holds about 40% of global proven critical mineral reserves, including platinum group metals, copper, cobalt and significant uranium deposits. Yet exploration spending has fallen from about 16% of global budgets a decade ago to around 10% today, reflecting investor caution amid coups, policy volatility and security risks in West and Central Africa.

“We are back to an era of great power competition,” Ronak Gopaldas, director at Signal Risk and visiting fellow at the London School of Economics told a session on Tuesday. “We’ve got mercantilist economics. We’ve got zero sum politics. Multilateralism is fraying. Trade has become securitized.”

Across two panels examining geopolitics and critical minerals, executives and policymakers asked: can Africa convert its mineral leverage into infrastructure, processing and durable industrial growth, or will renewed great-power rivalry simply entrench extractive patterns shaped by foreign capitals? The debate turned on governance, regional coordination, local processing, security risk and whether U.S.-China competition gives African states leverage or pressure.

History’s lessons

Daniel Litvin, founder and CEO of Resource Resolutions, warned that history offers sobering lessons.

“Governments of resource rich or resource holding countries, for example, African governments, they need to play that game very smartly and strategically or risk being played by the great powers,” he said.

“There’s a risk that there is more in the elite enrichment rather than broad based developments,” Litvin said, adding that great powers’ narratives on partnership might just mask their own self-interest.

Others struck a more optimistic tone.

Brian Menell, chairman and CEO of TechMet, a critical minerals investment firm deploying Western state-backed capital, said the geopolitical environment is structurally favours Africa.

“We’re in a new Cold War era dominated by competition between the U.S. and U.S. allies and China and China’s clients, allies,” Menell said. “One of the key fronts is control of resources.”

China controls roughly 60% of global rare earth production and over 80% of rare earth processing capacity. The International Energy Agency estimates demand for critical minerals used in clean energy technologies could more than double by 2040 under current policy settings, underscoring why supply security has moved to the centre of industrial policy in Washington, Brussels and Beijing.

“The world needs more and more of what Africa has,” Menell said, “in order to feed the energy transition, AI, data centres, defence industries, drones, autonomous driving systems.”

Profitability thrust

Mike Kopp, senior adviser to the U.S. Secretary of Energy, said Washington has already committed tens of billions of dollars to critical-mineral supply chains and is expanding technical partnerships through its national laboratory system.

“We’re coming here to build the market like we’ve never seen it before,” Kopp said. “We’re for profit. We want everybody to be profitable.”

The U.S. also plans to use AI “rigorously” as it seeks to improve the technologies that will help companies and markets make money, Kopp added.

While external capital is increasing, panellists stressed that domestic policy remains decisive.

Gracelin Baskaran, director of the Critical Minerals Security Program at the Center for Strategic and International Studies in Washington, framed Africa’s opportunity around what she called “the third G.”

“It is not just about being at the right geopolitical moment,” she said. “It is not just about having geology. So we have two Gs, but it’s about the third G, which is government. You need to get governance right!”

Baskaran noted that exploration budgets have shifted away from higher-risk jurisdictions. Exploration in Mali and Burkina Faso has declined sharply since military coups in 2020 and 2022, while Niger’s uranium sector including Orano’s Somair mine has faced regional sanctions and political uncertainty.

“If you don’t look, you don’t find,” she said. “If you don’t find, you don’t produce.”

In Mali, tensions over taxes from the military-led government closed Barrick Mining’s (TSX: ABX; NYSE: B) Loulo-Gounkoto gold complex and contributed to former CEO Mark Bristow’s resignation in September before a $430-million settlement.

Youth advantage

Africa has the world’s youngest population, with a median age of about 19 years compared with roughly 38 in the United States and more than 44 in Europe. It’s a demographic profile that executives say could underpin long-term industrial capacity if paired with skills development and infrastructure.

Mpumi Zikalala, CEO of Kumba Iron Ore (JSE: KIO), which is controlled by Anglo American (LSE: AAL; JSE: AGL) and operates the Sishen and Kolomela mines in South Africa, said the continent’s demographic profile strengthens its long-term leverage.

“Africa holds a disproportionate amount of critical mineral endowment,” she said. “When you’ve got the people, you can actually train them and get them to do what needs to be done.”

Zikalala cautioned against focusing on negatives and urged a look at future opportunities.

Those prospects are often limited by energy and logistics constraints. Former U.S. ambassador J. Peter Pham, who is also executive chair and interim CEO of Ivanhoe Atlantic, pointed to the company’s iron project in Guinea as an example of how resource potential must be matched with infrastructure. The high-grade Kon Kweni project hosts one of the richest deposits globally, with a grade of about 67% iron.

The project relies on cross-border rail access through Liberia, where the government recently ratified a concession and access agreement and agreed to establish an independent rail authority to support exports.

Corridors

Rio Tinto (LSE, ASX,NYSE: RIO) and Chinese partners are ramping up iron ore shipments from Simandou in Guinea along a separate $13-billion rail and port network. The U.S. is investing billions in the Lobito Corridor, a set of railways linking Africa’s copper belt in the Democratic Republic of Congo and Zambia with an Atlantic port in Angola. And China is spending similarly on a rival line from the same region, across Tanzania to the Indian Ocean.

“These corridors will last long after we’re gone,” Pham said. “Port, rail, human capital and energy are critical elements to critical minerals.”

“Our licence to operate is not just a piece of paper from a government,” he said. “It’s the social licence to operate.”

Despite its resource base, Africa processes only a small fraction of its mined minerals domestically, exporting most concentrates to China, Europe and elsewhere for refining and higher-value manufacturing.

Theophilus Acheampong, technical adviser to Ghana’s finance ministry, said African governments must ultimately anchor strategy internally rather than depend on foreign powers.

“If history has taught us anything, it is the fact that often you cannot rely on other external partners to deliver your country for yourselves,” he said. “You have to build the institutions at home, and you have to be clear about what you want to achieve.”