This growing international attention to developing Africa’s critical minerals could help lead to a more prosperous and stable continent. Many African countries have high hopes for what their mineral resources can do for their countries’ development trajectory. Indeed, some senior U.S. policymakers have spoken in bold terms as to the role Western-backed mining could have in transforming African economies. Top White House energy official Amos Hochstein told an African mining conference this year, “The energy transition is an opportunity for an Africa transition.”

However, it is also possible that the intensified development of these natural resources could worsen economic inequalities, increase corruption and spur instability and conflict on the continent, as has been often seen in Africa. The United States and its partners can work with African countries to help ensure that the dividends of these resources go first and foremost to Africans. But it will first have to overcome the immense in-roads China has already made on the continent.

Beijing Firmly Entrenched

Beijing has pursued a decades-long strategy to secure a reliable supply of critical minerals through its Belt and Road Initiative and other efforts. State-backed Chinese companies have ownership positions in mining companies on five continents. In Africa, China is already well entrenched. For example, in the Democratic Republic of Congo (DRC) — which supplies 70 percent of the world’s cobalt — Chinese entities own or have stakes in nearly all the country's producing mines.

Beijing has recently ramped up its buying streak. Chinese mining and battery companies have invested $4.5 billion in lithium mines in the past two years and are behind much of Africa’s lithium projects in countries like Namibia, Zimbabwe and Mali. It is estimated that China could secure one-third of the world’s lithium mining capacity by 2025.

China’s dominance in the sector hasn’t been beneficial to Africans. Its contract concessions are typically opaque and heavily tilted toward Beijing. Indeed, just the other week, DRC President Felix Tshisekedi traveled to Beijing, seeking to renegotiate a lopsided $6 billion infrastructure-for-minerals deal with Chinese leader Xi Jinping. In place since 2008, the deal has sent billions in minerals to Beijing, but little infrastructure for the DRC has materialized in return. And Chinese-owned and operated mines certainly don’t place the same level of emphasis on environmental mitigation and worker safety as Western competitors.

Extraction is just the tip of the iceberg, as China also has a stranglehold on the refining and processing of these minerals. Ideally, the United States and its partners could work with Africans to form a critical mineral supply chain free of Chinese influence. But as some American car manufacturers and others are finding out, that’s easier said than done. With a huge head start in building mining infrastructure, including financing operations, China is a known entity for throughout the continent. The United States needs to catch up.

Can the U.S. Step Up its Game in Africa?

The Biden Administration has declared that the United States is “all in on Africa, and all in with Africa.” Part of its new focus on engaging the continent will emphasize critical minerals. Last summer, the White House released its Africa strategy, emphasizing that the United States will assist African countries to “leverage” their critical mineral resources for economic development while “helping to strengthen supply chains that are diverse, open, and predictable.” Just a few months ago, officials from across the U.S. government made up the most significant U.S. delegation to ever attend Mining Indaba, Africa’s most prominent mining conference. The administration is bringing together allies and partners through initiatives like the Mineral Security Partnership, a new group of like-minded countries designed to increase Western investment and bolster critical mineral supply chains.  

The Biden administration’s series of high-level visits to the continent frequently include a stop in Zambia, home to one of the world’s richest deposits of copper — essential to electrification. Democratically elected President Hakainde Hichilema has set a goal of tripling Zambia’s copper output over the next decade. Financial analysts caution that hitting such an ambitious target would require $30 billion of investment. The country’s finance minister recently said, “The oil of Zambia — namely copper — is going to bring the benefits that we’ve seen elsewhere ... [of] course, it’s our responsibility that when this money comes through, it must be used properly.”

All of these developments have piqued renewed interest in Africa’s mining sector. But those looking to invest long-term — as well as Africans themselves — aren’t so sure the U.S. commitment to the continent is what it needs to be. For one, they see that U.S. embassies on the continent are chronically understaffed. And while there are signs of some improvement, U.S. diplomats have long trailed their counterparts from other world powers when it comes to practicing “commercial diplomacy.”

A Challenging Market

Western business interests have been hesitant to invest in countries with weak governments or poor labor practices, which are common in some African countries. Despite the presence of some of the biggest and most sophisticated mining companies in the world, the images of labor-intensive artisanal mining can be hard to shake, negatively impacting impressions of the African mining sector. This creates somewhat of a catch-22, as Western investment is critical to raise labor and environmental standards in these challenging markets.

Of course, the surest way to spur more Western investment in Africa’s natural resources is a rising market price. After all, these are private-sector enterprises. But here, too, there are challenges. Throughout history, the mining industry has been caught in a boom-and-bust cycle. Today’s critical minerals are no different. For instance, a recent increase in Indonesian cobalt on the market has helped to bring prices down from $40 per pound a year ago to approximately $15 this month. It was announced in May that the final construction of an Idaho cobalt project was suspended due to market conditions.

Complicating matters, evolving technologies could change the composition of today’s batteries, making decisions about long-term investment even more challenging to calculate. Additionally, there’s continued uncertainty surrounding the treatment of mineral sourcing for U.S. tax law purposes. Suppressed prices for these key materials threaten to make the supply predicament even worse.

Of course, natural resources development has historically contributed to conflict across the continent. Today access to minerals in eastern DRC has fueled armed groups committing human rights abuses. Mozambique’s Cabo Delgado region is suffering from violence partly driven by grievances over the development of mineral resources.

To help “de-risk” investments in the developing world, the United States government has revamped financing agencies like the U.S. International Development Finance Corporation and the Export-Import Bank. However, support from these agencies for mining projects has been slow to materialize.

What Should Washington Do?

The United States is right to boldly envision how a flourishing mining sector can lead to a flourishing Africa, contributing to peace and stability. This helps communicate to Africans that the United States is interested in their prosperity, not just extracting their resources. Western-backed mining projects designed and operated transparently and inclusively stand a better chance of long-term success, employing local workers, benefiting the community and undermining those fomenting conflict while weakening China’s control over these vital resources.

While this vision is sound, at this point, it is only a vision. A close look at the issues surrounding the development of Africa’s critical minerals shows how complex and resource intensive it will be to move the vision expressed by the Biden administration and Africans from ambition to reality. 

To help tackle the complex issues surrounding Africa’s critical minerals, the United States Institute of Peace is convening a senior study group to provide recommendations to U.S. and African governments, the private sector and civil society to ensure these vital natural resources bring prosperity and stability to all Africans. Because this much is sure — these resources will be developed. The only question is by whom, in what manner and to whose benefit? These answers will impact peace and stability in many African countries.