Africa’s vast mineral reserves are taking on new strategic importance as geopolitical tensions increasingly fragment global trade, according to a new report from the African Finance Corporation (AFC).
Changing trade rules, export restrictions and increased industrial competition are reshaping global supply chains, the report said. Against this backdrop, Africa has an opportunity to reposition itself, but only if countries decide carefully where and how to participate in delicate global value chains.
The report, Compendium of Africa’s Strategic Minerals, 2026, lists “trade and geo-economic realignment” as one of its five key findings, arguing that it is increasing the strategic relevance of Africa’s minerals at a time when supply chains for rare earths, battery materials and other critical inputs are under visible strain.
Major economies are concerned about concentration risks and national security and are seeking alternative sources of supply. Africa, which has the world’s most diverse mineral wealth, is at the center of its exploration.
Great wealth, limited value acquisition
Africa’s mineral resources are estimated to be worth $29.5 trillion at mine sites, approximately 20% of the world’s total. Of this, $8.6 trillion remains untapped, equivalent to approximately 2.5 times the continent’s annual GDP. But the continent captures only a fraction of the value embedded in its resources.
“The binding constraint is transformation, not geology,” the report states. The key challenge lies in converting mineral resources into productive assets, infrastructure, industrial capacity, regional value chains and competitive manufacturing platforms.
China currently controls about 90% of the world’s manganese refining and rare earth processing, and has a monopoly on the production of graphite for batteries. Similar concentrations are found in aerospace and defense supply chains, where minerals such as chromium, graphite, rare earths, and tungsten are highly concentrated. As nuclear power returns to energy security discussions, uranium is also regaining strategic relevance.
In this context, Africa’s non-aligned location and mineral diversity represent what the report calls a “real strategic advantage.” However, it warns against indiscriminate insertion into global value chains.
“The aim is not to incorporate Africa everywhere, but to locate Africa where supply chains are most concentrated and where diversification greatly enhances resilience,” the analysis says.
For example, while African manganese smelters compete in a diversifying global market, South Africa’s only manganese smelter (one of only three outside China) has strategic value because it provides a reliable non-Chinese alternative at a key checkpoint.
Extract without converting
The report argues that while Africa continues to export raw minerals at low prices, it imports high-value finished products made from the same resources, effectively paying twice its own wealth.
Each country accounts for only a small portion of the value chain, as it bears the logistics costs of exporting ore and absorbs additional transport costs, insurance premiums and value-added margins when importing processed goods.
The three conditions of mineral resources themselves, reliable infrastructure (particularly electricity and transport), and strong market demand rarely coexist within African economies. As a result, even commercially viable processing projects are often stalled due to unreliable electricity, weak transport links, and fragmented domestic markets.
Still, the potential benefits of processing are significant. The $2.8 trillion of iron ore in Africa’s mine gates could be converted into $25.4 trillion of steel. Similarly, the $874 billion bauxite expands to $5.2 trillion as alumina and up to $15.4 trillion when smelted into aluminum.
The report points to early signs of relocation. Angola is planning Africa’s first rare earth refinery. Mozambique has entered the largest natural graphite and anode supply chain outside China. Battery-grade manganese sulphate projects are underway in South Africa and Botswana. Uranium production has resumed in Namibia (2024) and Malawi (2025).
These developments signal a gradual transition from pure extraction to selective integration into strategic supply chain segments.
Regional integration as a catalyst
But isolated projects alone are not enough, the report warns. Africa’s minerals strategy needs to evolve into an infrastructure-supported, regionally integrated and policy-aligned platform.
Geological data systems remain fragmented and outdated in many countries, limiting exploration and investment. The report urges African governments to treat geological data as strategic infrastructure and build modern, connected systems.
“Africa’s minerals story has been too narrowly framed by fragmented data, an upstream-only lens, and priorities set primarily outside the continent,” said Samaira Zubair, president and chief executive officer of AFC. “This report is a deliberate effort to reframe Africa’s minerals sector through an African lens, focusing on infrastructure, mineral processing and domestic demand.”
Africa’s development priorities go beyond a narrow list of energy transition minerals. Rapid urbanization and increased demand for electricity, construction materials, fertilizers, clean energy technologies, and automobiles will significantly increase future mineral demand. However, the domestic market is often too small to sustain a large-scale processing industry on its own.
Only through regional demand aggregation, the report argues, Africa can build a competitive mineral processing industry.
The report cites examples such as Morocco’s phosphate sector, North Africa’s steel industry and the Copperbelt’s copper industry, where infrastructure, scale and stable demand supported success.
Infrastructure and money as strategic tools
Infrastructure is at the heart of the report’s minerals strategy. Reliable electricity, efficient transportation, industrial land and an effective trade system are presented as prerequisites for building a local mineral industry.
The report maps mines alongside railways, ports and power hubs to identify where cross-border value chains can realistically expand.
Gold is also being looked at as a strategic opportunity. Africa has over $5 trillion in gold resources, but only a small percentage of the continent’s total external reserves.
The report suggests that Ghana and at least 14 other African countries with formal gold refineries could make more active use of gold to shore up foreign exchange reserves and stabilize their economies.
Ghana’s creation of a Goldbod in 2025 is cited as an example of institutional reforms aimed at increasing reserves, formalizing artisanal mining, reducing smuggling and stabilizing the macroeconomy. The country has rebuilt its foreign exchange reserves of more than $10 billion and achieved significant currency appreciation.
