AT the Investing in Africa Mining Indaba in Cape Town, African leaders and industry experts emphasised the urgent need to process the continent’s minerals locally instead of continuing to export raw resources.
The push for local beneficiation comes amid global economic shifts, trade tensions, and de-globalization trends, which are threatening Africa’s traditional role as a supplier of raw materials. The continent must now move beyond extraction and create industries that generate greater economic value, jobs, and long-term growth.
Speaking at the forum titled Future-Proofing African Mining, Today, policymakers and business leaders warned that if Africa does not develop its own processing capacity, it risks losing economic control over its vast mineral wealth.
Why Africa needs to prioritise local beneficiation
The demand for critical minerals such as platinum, lithium, cobalt, manganese, and palladium is rising globally, especially due to the transition to electric vehicles and renewable energy technologies.
However, African nations continue to export these minerals in raw form, missing out on the economic benefits of processing and manufacturing industries.
South Africa’s Minister of Mineral and Petroleum Resources, Gwede Mantashe, stressed that local beneficiation is an economic necessity rather than a political agenda.
‘We must invest in local beneficiation because it is a business decision, not a political one. If it costs less to export raw materials than to process them here, the market makes that decision. We must reverse that trend.’
Mantashe urged global investors : ‘Investors, make your money here. When you profit, reinvest in our communities by building schools, clinics, and infrastructure.’
According to Marit Kitaw of the Africa Minerals Development Centre, Africa cannot afford to delay action.
‘Africa must take ownership of its mineral wealth by processing it locally. This is not just about economic growth; it is about safeguarding our future against an unpredictable global trade environment.’
The economic case for local processing
Africa’s mining industry plays a crucial role in national economies, but its contribution remains limited due to the export-driven model.
For instance, South Africa’s mining sector contributed 6 percent to the country’s GDP in 2024, down from 6.3 percent in 2023. Exports were valued at R800bn ($42bn), representing 45 percent of total merchandise exports.
Despite these figures, logistical challenges, declining non-gold commodity prices, and global market fluctuations have restricted industry growth.
If African countries can process their minerals locally, they could: retain more economic value within the continent, create jobs through industrialisation, reduce dependency on foreign markets and fluctuating commodity prices as well as build a stronger foundation for advanced industries like electric vehicles and battery manufacturing.
Key policies to boost beneficiation
To drive investment in mineral processing, African governments are working on policy reforms and incentives for investors.
Major initiatives announced:
- New mining licensing system – South Africa is finalising a streamlined approval system to attract investment.
- Online mining cadastre system launching in June 2024 – designed to increase transparency and efficiency in the sector.
- A revised Minerals and Petroleum Resources Development Act – aimed at strengthening beneficiation policies.
- A critical minerals list and strategy – governments are working to identify priority minerals for processing industries.
SA’s mineral wealth: a competitive advantage
South Africa remains one of the world’s leading mineral producers, holding significant reserves of key resources with the following global mineral contributions:
- 73 percent of the world’s platinum group metals (PGMs).
- 30 percent of global palladium supply.
- 36 percent of the world’s manganese output.
While gold production has declined to 96 tonnes in 2023, the growing demand for electric vehicle (EV) minerals presents a new economic opportunity.
‘Instead of shipping out raw bauxite, we must focus on transforming it into alumina and aluminium right here in Africa,’ said Samaila Zubairu, CEO of the Africa Finance Corporation.
Downstream industries and the EV market
The push for local beneficiation aligns with global industrial shifts, particularly in sectors like electric vehicles (EVs) and renewable energy.
Martina Biene, Chair of Volkswagen Group South Africa, emphasised the importance of a strong beneficiation sector in supporting automotive production.
‘A robust beneficiation process stabilises raw material costs and fuels innovation in industries like automotive manufacturing. South Africa needs a steady supply of locally processed minerals—steel, aluminium, copper, lithium, cobalt, and nickel—to maintain competitiveness.’
With global trade trends shifting toward protectionism, strengthening local supply chains will help Africa secure its role in the future of manufacturing and technology industries.
The question remains: Will Africa seize this opportunity to process its minerals locally, or will it continue to rely on exporting unrefined resources?
