This puts Africa in a particularly enviable position, as it holds over USD 30 trillion worth of rare earth minerals required for batteries and other equipment necessary for a complete green energy transition. The continent also has about 48% of the world’s manganese, 22% of natural graphite, 55% of the world’s cobalt deposits, and notable shares of nickel and lithium.

The Democratic Republic of Congo is responsible for 70% of global cobalt production. South Africa, Gabon, and Ghana produce 60% of global manganese.

But the arrangements from its colonial past still linger on in the African economy, as Western governments and corporations still view the continent as a mine to extract resources from rather than a genuine partner who can add value and create industrial products useful for the global economy.

No major international player is speaking about Africa using its wealth for internal economic transformation. Most just see it as an ore supplier. And though ore supplies will create a few jobs, it will continue to be an aftermath of colonialism. Africans desperately want to be a part of the refining, processing and manufacturing side of the supply chain.

Domestic plants could create thousands of jobs as opposed to the few hundred jobs offered through traditional resource extraction. Policymakers in Africa have long called for local beneficiation (value addition done on African soil). They want the critical minerals to be used for industrialisation at home and not just for global decarbonisation.

For example, Africa has $2.8 trillion worth of iron ore, which could be worth $25 trillion in steel if it adds value. The USD 834 billion in bauxite could be worth USD 15.4 trillion in aluminium with full processing.

Industrialisation is a matter of urgency for the continent as its population is exploding, with 30 million people born annually. Without manufacturing jobs, most of these young workers wouldn’t be able to land their first job. Building a mineral-to-manufacturing corridor will reduce Africa’s import bill by USD 16 billion annually.

Mining jobs in the DRC support over 100,000 people. In Namibia, there are 20,000 workers, and in Zambia, there are over 70,000. With value addition, millions more can enter the workforce.

The myriad nations of Africa cannot hope to bargain with the great European and American powers alone. It’s only through a grand union that they can even hope to negotiate a fair deal.

This is exactly why African Continent Free Trade Area (AfCFTA) is an important part of this equation. Without the AfCFTA coordinated policies on taxes, prices and beneficiation will be impossible. The exploitative bilateral deals which have stolen wealth from African mines will no longer hold in front of a unified front.

Africa has over 1.4 billion people, and the vast continent with so many people can make value addition seamless as opposed to a single country taking this route. For example, cross-border power grids could supply energy to all plants and make African companies competitive and sustainable.

This grand ambition is constrained by persistent challenges, including governance risks, infrastructure deficits, global resistance to domestic processing, and regulatory inconsistencies. But there is hope left, as reforms in Ghana (bauxite), Zambia (copper), and Kenya (digital licensing) indicate policy progress. America and Europe prefer or even incentivise processing on their own turf. But Africans must negotiate fair inclusion in the value chains if they are going to remain relevant in the 21st century.

Energy and sustainability are also a big headache. No mineral-based industrialisation is possible without reliable and clean power. Africans can explore several options for sustainable power refining, including green hydrogen, hydropower, and geothermal energy. Clean energy can be combined with mineral processing, particularly in East Africa, for a competitive edge.

The IEA says that lithium demand would be fivefold in 2040, and demands for cobalt and rare earth may rise by 50%-60%, with copper by about 30%-50%.

A deal without technology transfer, skill development, and joint ventures is not in Africa’s interest. According to AfCFTA, if the strategy is effective, African nations could increase their bargaining power to a level comparable to the GCC’s bargaining power at the height of oil production in the 20th century.

The post IF Insights: Rare earths emerge as Africa’s new leverage point appeared first on International Finance.

The vast Clarion-Clipperton Zone (CCZ) lies here, an underwater plain that stretches across approximately 1.7 million square miles (around 4.5 million km²) between Hawaii and Mexico. It’s an alien world where life has adapted to crushing pressure and eternal night. In fact, recent research catalogued over 5,500 species living in the CCZ, with an astonishing 88–92% of them new to science.

This zone is not alone in its significance. Scientists estimate that millions of species, perhaps up to 10 million, may inhabit the deep ocean below 200 metres. Yet as rich and mysterious as this marine biodiversity is, these same deep-sea floors are also home to something else of extraordinary value: untapped stores of critical minerals.

According to some estimates, a single swath of the CCZ contains more nickel, manganese, and cobalt than all known terrestrial reserves combined. Potato-sized black rocks called polymetallic nodules litter the seabed here.

First noted by 19th-century ocean expeditions, these nodules are rich in metals vital for modern technology, from copper and nickel for electric vehicle batteries to cobalt and manganese for renewable energy systems. For decades, the idea of harvesting this deep-sea mineral treasure was confined to theory.

With advancing underwater mining technology, that vision is hurtling toward reality. The year 2025 could mark a turning point. Dozens of exploratory missions have already probed the deep, and full-fledged commercial seabed mining looms on the horizon.

Treasures of the deep

In an era obsessed with smartphones, electric cars, and clean energy, these deep-sea minerals are often described as the “new oil” powering the global economy. Demand for critical raw materials is surging, and policymakers argue they are indispensable for the green transition.

Polymetallic nodules, which form over eons in the abyssal muck, are packed with these high-value elements. In fact, a study by the United States Geological Survey found that the Clarion-Clipperton Fracture Zone could hold more nickel, manganese, and cobalt than all land-based reserves worldwide. One consulting firm even valued the CCZ’s metal bounty at roughly $18 trillion.

Commercial interest in these “rocks” has been growing since at least the 1970s, but it accelerated after the International Seabed Authority (ISA) was established in 1994. The ISA, a body affiliated with the United Nations, is tasked with regulating mineral activities in international waters. To date, the ISA has issued 31 exploration contracts covering more than 1.5 million square kilometres of seabed—an area roughly four times the size of Germany.

Major economies like China, Russia, and South Korea are among those sponsoring deep-sea exploration ventures. Private companies have also entered the fray. A Canadian firm, The Metals Company, successfully tested a robotic nodule collector in 2022, proving that harvesting these seabed minerals is technically feasible. All signs point to the race to the ocean bottom now truly underway.

Proponents of deep-sea mining argue that it could relieve pressure on terrestrial mines, potentially sparing rainforests and communities from the ravages of surface extraction. However, this optimism glosses over a critical fact. Mining is destructive, no matter where it’s done.

On land, digging up minerals means clear-cutting forests, blasting open pits, and generating toxic waste. It leads to habitat loss, polluted waterways, and greenhouse gas emissions from energy-intensive processing.

If surface mining is any indication, doing it in the deep sea, an environment even more delicate and completely unspoiled by humans until now, could be catastrophic. Heavy machines would churn up seabed sediments and vacuum up nodules by the ton, disrupting a world that has existed in silence for millions of years.

Crucially, polymetallic nodules are not just inert rocks; they are a habitat. Some deep-sea creatures live on or around them, and even use them to lay eggs (scientists recently observed the “ghost octopus” breeding on these nodules in the CCZ). Removing the nodules is akin to ripping out the foundations of an ecosystem.

Life finds a way

What makes the prospect of deep-sea mining especially alarming is how little we know about the environments poised to be disturbed. The deep ocean is Earth’s largest ecosystem, comprising roughly 90% of the total volume of our oceans. Yet it remains mostly unexplored. By some estimates, 80% of our oceans have never been mapped or observed by humans.

In the past century, scientists have made one staggering discovery after another, revealing that life thrives even in the most extreme depths. In 1977, researchers diving near the Galapagos Islands found hydrothermal vents teeming with bizarre organisms, from giant tubeworms to clams the size of dinner plates. These creatures survive not through photosynthesis, but chemosynthesis, harnessing chemical energy from the vent fluids, an entirely new paradigm of life independent of sunlight.

Since then, numerous expeditions have catalogued countless oddities of the deep. Fish with transparent heads, crustaceans that withstand immense pressure, and corals that form forests in perpetual darkness are among them.

As new species are discovered on virtually every deep-sea expedition, scientists now believe the deep ocean’s biodiversity may rival or exceed that of shallow waters. Yet, these extraordinary creatures are equally fragile. Having evolved in an environment of constant conditions, even slight changes in temperature, chemical makeup, or light can be devastating.

Unlike surface ecosystems that might rebound after disturbances, deep-sea life often grows and reproduces slowly. A coral colony in the abyss might be hundreds or thousands of years old, and a disturbed nodule field might never recover at all in human terms.

The threats from seabed mining are manifold. Directly on the seafloor, bulldozing through sediment will smother organisms and eliminate habitats. But the impacts won’t be confined to the deep. Mining ships at the surface will shine bright lights into waters that have been dark for millennia, potentially disorienting animals adapted to near-total darkness.

The operation of machinery will introduce intense noise pollution, adding to the cacophony that marine mammals already struggle with. Whales and dolphins, which rely on sound to navigate and find food, could be gravely affected by the continuous roar of seafloor mining equipment.

Moreover, grinding up the seabed will create vast plumes of fine sediment that can drift for dozens of miles, clouding the water and clogging the gills and feeding apparatus of fish and filter-feeders far from the mining site.

Crossing the Rubicon

In April 2025, US President Donald Trump signed a controversial executive order aimed at fast-tracking deep-sea mining in American waters and international high seas. The order directed American agencies to expedite permits for seabed mining and even asserted American intent to allow mining “beyond national jurisdiction,” effectively thumbing its nose at international oversight.

This move is unprecedented. The United States is the only major economy that hasn’t ratified the 1982 United Nations Convention on the Law of the Sea (UNCLOS) and thus isn’t a member of the ISA. By unilaterally authorising seabed exploitation outside its exclusive economic zone, the United States is bypassing the ISA’s long-running effort to develop a global mining code for the oceans.

By creating its own parallel system for granting mining rights, the US has crossed a diplomatic Rubicon, clashing with global consensus and raising the spectre of a free-for-all scramble on the high seas.

This American stance comes at a time when much of the world is pumping the brakes on deep-sea mining. In late 2024, Norway’s government agreed to pause its plans for the first commercial deep-sea mining licenses after an outcry from environmentalists and a small support party in Parliament.

The decision halted what would have been the world’s first large-scale mining of the Arctic seabed. Likewise, a coalition of over 30 countries, including Germany, France, Spain, Canada, the United Kingdom, and many Pacific Island nations, has called for a moratorium of at least 10 years on all deep-sea mining.

Several major global corporations like BMW, Volvo, Google, and Samsung have pledged not to use any deep-sea minerals in their products until rigorous scientific studies demonstrate that mining would not harm ocean environments.

These companies, alongside environmental groups like the WWF, support a precautionary pause, noting that with so much of the deep ocean unexplored, forging ahead now would be “recklessly short-sighted.”

Even within the mining and metals sector, some executives quietly admit that the optics and risks of deep-sea extraction are troubling. Many have begun investing in improved recycling and terrestrial alternatives instead.

Need or greed?

Supporters of deep-sea mining insist they are driven by necessity, not greed. The narrative goes like this: The world’s appetite for metals is skyrocketing, and we will soon face critical shortages that could derail the clean energy revolution.

By some oft-cited projections, demand for minerals could increase by nearly 500% by 2040 as electric vehicles, solar panels, and batteries proliferate. “We have no choice,” say mining advocates. To meet climate goals and maintain supply chains, one must find new sources of metals, and the deep sea is our best option.

However, a closer look at market realities paints a far less dire picture. In fact, recent years have seen gluts and price collapses in several key minerals, calling into question the inevitability of shortages. The global production of lithium hit a record high in 2024. And instead of a shortage, the result was a surplus of roughly 154,000 tonnes of lithium (measured in lithium carbonate equivalent) that year.

Weaker-than-expected electric vehicle sales contributed to this oversupply, sending lithium prices plummeting by nearly 80% from their 2022 peak. Similarly, a massive expansion of nickel mining in Indonesia has flooded the market.

Indonesia now produces over 60% of the world’s nickel, and the surge in supply has led to three consecutive years of oversupply, driving benchmark nickel prices down to nearly half of what they were in early 2022.

Cobalt, another battery metal, is also in a state of excess. Record-high cobalt output (thanks in part to major producers in the Congo and China) has so outpaced demand that cobalt prices plunged to their lowest levels since 2016.

And even copper, often touted as the most crucial green transition metal, is currently abundant. Global copper inventories in mid-2024 reached their highest level in four years, reflecting the biggest glut in the copper market in at least four years.

In short, the doomsday supply crunch that proponents of seabed mining warn about has yet to materialise. Metals markets are cyclical and notoriously difficult to forecast. Demand forecasts can be wildly off the mark, swinging with new technologies, economic shifts, and policy changes.

For example, battery makers are already adapting to material concerns. Tesla, the world’s leading electric car maker, revealed that by early 2022, nearly half of its new vehicles were built with cobalt-free batteries (using lithium-iron-phosphate chemistry instead).

Other automakers and tech companies are investing in reducing reliance on rare minerals, from developing nickel- and cobalt-free batteries to improving designs for recyclability. Meanwhile, recycling programmes are ramping up for existing electronics and EV batteries.

According to the International Energy Agency, a major scale-up in critical mineral recycling could cut the need for new mining by 25–40% by 2050. In the face of such innovations, the rationale for an urgent dive into seabed mining starts to look shaky.

All of this begs the question: Is deep-sea mining truly about meeting an unavoidable need, or is it about opportunism and profit? The sceptics argue it’s the latter. They point out that many companies involved are junior mining firms and investors looking for the next frontier, hyping the deep sea as a trillion-dollar opportunity to boost their stock values. Governments, for their part, may be invoking “resource security” to justify power plays in regions beyond their sovereignty.

The Trump administration projected that domestic deep-sea mining could add $300 billion to US GDP over a decade and create 100,000 jobs, lofty numbers that critics say gloss over the likely colossal environmental cost. As one prominent marine policy expert noted, the economic merits of deep-sea mining are still far from clear. What is clear is that once the seabed is torn up, the damage cannot be easily undone.

The ocean floor

The push to mine the ocean floor cannot be separated from the broader context of international competition. Nowhere is this clearer than in the rivalry between the United States and China. For the past two decades, China has methodically cornered the market on critical minerals.

It accounts for about 61% of global rare earth element production and an overwhelming 92% of rare earth processing, essentially a near-monopoly on turning those raw oxides into usable materials.

“While the Middle East has oil, China has rare earths,” Chinese leader Deng Xiaoping famously quipped in the 1980s.

That statement has proved prophetic. Through heavy state investment and strategic partnerships, China built a dominant supply chain. Today, it effectively controls which countries or companies receive many crucial minerals, using this power as a geopolitical tool.

Potential exploitation

Our oceans produce most of the oxygen we breathe, regulate the climate, and sustain millions of people with food and livelihoods. And yet, they remain one of the least understood frontiers. Every deep-sea expedition yields new wonders, species and ecosystems we didn’t even know existed.

To disturb these habitats irreversibly before we’ve even documented them would not only be tragic, but it would be foolish. As one marine conservation group bluntly put it, the decision to mine the deep sea is “not just an economic question, it is an existential one.”

Companies and a handful of nations are ready to take the plunge. Giant machines sit poised to descend and crawl upon the abyssal plains. The regulatory net that should restrain them is frayed and incomplete. The ISA has been debating a mining code for years, with meetings in 2023 and 2024 struggling to finalise environmental safeguards.

However, with the two-year trigger rule invoked by one small nation (Nauru) in 2021, the ISA faces pressure to allow mining even without comprehensive rules in place. The governance gaps and loopholes are large enough for a mining vessel to sail through. If powerful countries now start ignoring the ISA entirely, the notion of collective stewardship of the “common heritage” could collapse overnight.

The post Mining the abyss: A dangerous gamble? appeared first on International Finance.

In January 2024, South Africa played host to the largest mining investment conference in the world. According to industry insiders, China and the United States are vying for vital minerals like cobalt and lithium, which are expected to be essential for driving the anticipated shift to sustainable energy.

Some of the largest reserves of these materials are found in African nations like the Congo, but China now controls the supply chain and refines them, and the United States wants to lessen its reliance on the massive Asian nation.

“I don’t need to remind you of what happens when the supply chain breaks down or when we depend on a single supplier,” United States Under Secretary of State for Economic Growth, Energy, and the Environment Jose Fernandez alluded to this during his remarks at the recent mining conference in Cape Town.

Fernandez stated that by 2030, electric cars should account for half of the world market, and by 2040, the need for lithium should have increased 42 times. Approximately 80% of the world’s lithium refining is done in China.

The Africa Mining Indaba conference’s international adviser, Tony Carroll, the director of Acorus Capital, told Voice of America (VOA) that the session was timely for the West.

“About 20 years ago, the Chinese made it their priority to corner the market for critical minerals, and they backed up that approach with significant infrastructure expenditures and public diplomacy in Africa, the majority of which came from long-term loans. The West has been scurrying ever since they discovered this tactic too late,” Carroll claimed further.

The production of electric vehicles and the expansion of green technology production depend on “Rare Earth Minerals”. However, African nations with large resources may have to pay a social or environmental price for its exploitation.

In what could be interpreted as a jab at Beijing, Fernandez repeated comments made by Pope Francis during a recent visit to the Congo criticising “economic colonialism” in Africa. Additionally, he gave assurances to African nations that the US will uphold “environmental, social, and governance standards.”

In 2024, the Chinese business Zijin, one of the biggest mining corporations globally with holdings in copper, lithium, and other metals, sponsored the Mining Indaba for the first time.

As it increased production at its new Kisanfu mine in the Democratic Republic of the Congo in 2023, China’s CMOC Group surpassed Glencore to take the top spot in the world’s cobalt production rankings.

The company’s production increased by 174% year over year to 55,526 metric tons, more than 25% of the 213,000 tons of global demand.

The cobalt market has been overtaken by Kisanfu, in which the massive Chinese battery company CATL holds a minority stake. According to the Cobalt Institute, one of the “biggest surpluses in recent years” occurred in 2023 when global production surpassed demand by 12,500 tons.

CMOC is not worried. Despite the decline in the price of cobalt from USD 40 per pound in May 2022 to the present USD 13, the company intends to increase output and open more tabs this year.

Some cannot afford to be that optimistic. Project economics have been completely turned upside down by the price crash, and Western expectations of becoming less dependent on China for a metal that is essential to military gear and clean energy technologies have been dashed.

However, the West is currently opposing China’s firm hold on the mineral resources that are beneath the surface of Zambia and the Democratic Republic of the Congo.

With both nations hoping to play significant roles in the quest for key minerals, this new race for Africa has a post-colonial twist.

The PR manager of South Africa’s Zijin Platinum said the CEO was unable to react before the deadline for this piece when asked by VOA if China and the United States are currently in a race for rare earth metals, in addition to other queries regarding Chinese mining interests in Africa.

Nowadays, African countries are attempting to negotiate the finest terms for their citizens. At the Cape Town conference, Namibia’s Mines Minister Tom Alweendo informed reporters that his nation is certain that any lithium mined there must be processed domestically.

Likewise, DRC President Felix Tshisekedi, a prominent speaker at the mining conference, has been pressing China for improved conditions for several years. China gets most of its cobalt from the Democratic Republic of Congo (DRC), which provides about 70% of the global supply.

Congo is one of the least developed nations in the world despite having abundant mineral riches, and Tshisekedi claimed in January 2024 that the USD 6.2 billion minerals-for-infrastructure deal that his predecessor had struck with China had not helped the country.

“The Chinese, they’ve made a lot of money and profited greatly from this contract,” Tshisekedi remarked to Bloomberg at the Davos World Economic Forum, while adding, “It has not benefited the Democratic Republic of the Congo in any way. Nothing concrete or beneficial, in my opinion, for our population.”

“Now our need is simply to re-balance things in a way that it becomes win-win,” he stated.

There are indications that Tshisekedi may be heading west.

US Spices Up The Game

The Minerals Security Partnership was established by US President Joe Biden’s administration in 2023 to diversify supply chains. Australia, Canada, Finland, France, Japan, the Korean Republic, Norway, Sweden, the United Kingdom, and the European Union are among the partners. The DRC was present at the organisation’s inaugural conference last year as one of the non-partner countries.

The DRC and Zambia then signed an agreement with the United States to work together to improve the supply chain for electric vehicle batteries during Biden’s US-Africa Summit in December 2023.

Speaking at the Indaba, Jay Truesdale, CEO of risk advice firm Veracity Worldwide, said, “Dependency on China for rare earths is viewed with alarm. Given that Beijing has the means to severely restrict access to these minerals, in the event of a geopolitical crisis it could choose to use its market dominance to cripple non-Chinese manufacturers in such sectors as electronics, automotive manufacturing, aerospace, and renewable energy.”

In addition to the escalating hostilities in Africa between China and the West, Truesdale predicted that Russia’s invasion of Ukraine would compel mining firms to make difficult choices.

“Russian mining operations throughout the continent are coming under more scrutiny as a result of the conflict in Ukraine. Where its mining corporations operate, Russia benefits from a lack of transparency and lax governance,” he stated further.

“African governments are now paying closer attention to how Moscow exchanges assurances of increased security for a closer look at mineral wealth and the potential for state control,” Truesdale concluded.

The post IF Insights: A new chapter in US-China rivalry, involving ‘Rare Earth Minerals’ appeared first on International Finance.

The Energy Transitions Commission (ETC) warned in research that significant supply gaps for lithium, nickel, graphite, cobalt, neodymium, and copper might push up costs and push back the deadline for achieving net-zero emissions by 2050.

The ETC stated that in order to lower the risk of a shortage, mines must produce more. However, since large-scale mining projects can take up to 20 years to complete, little has been invested in exploration and output over the past ten years.

“In some key minerals – particularly lithium and copper – it will be challenging to scale up supply fast enough over the next decade to keep pace with rapidly rising demand,” ETC Chair Adair Turner said in the report.

According to the ETC, over the past two decades, energy transition metals have received an average annual capital expenditure of USD 45 billion, as opposed to the USD 70 billion needed annually to increase supply by 2030.

“Governments, regulators, producers and consumers must work together to increase recycling, improve material efficiency, invest in new mining, and regulate environmental and social standards,” Adair Turner said.

The commission estimates that between 2022 and 2050, the production of up to 6.5 billion tonnes of materials will be necessary for the energy transition, with 95% of that production being made up of steel, copper, and aluminium.

The estimate assumes that sustainable energy technologies will be aggressively deployed to achieve global decarbonization, and that recycling and the amount of material required will follow current trends.

However, if investors are successful in accelerating technological, efficient, and clean energy material recycling advancements, the overall demand for new supplies from mines would eventually decline by 20% to 60%.

The post Metal shortage coming in next ten years, warns research appeared first on International Finance.