Africa should avoid only exporting raw minerals: UNCTAD

Spanish Market: Battery materials, Metals
17/08/23

African nations are rich in critical metals for batteries and electric vehicles (EV) but they should avoid only exporting their raw minerals, according to a new report by the United Nations Conference on Trade and Development (UNCTAD).

"While the need for Africa to integrate global supply chains is not new, we urge African countries to avoid being locked into the provision of 'just' raw materials, which results in very low-value integration into global supply chains," said UNCTAD secretary general Rebeca Grynspan in the new Economic Development in Africa Report 2023 released on 16 August.

The report comes as lawmakers in African nations increasingly see value in regulating their mineral resources and vowed to advance nationalistic industrialisation amid an accelerated global transition to EVs. Namibia and Zimbabwe introduced measures to ban unprocessed mineral ore exports. Ghana's minister of land and natural resources Samuel Jinapor tweeted in June that "under no circumstances will Ghana export its lithium and other green minerals in their raw state", as he reiterates Ghanaian president Akufo-Addo's commitment to ensure they capture added value.

African nations have the potential to be key suppliers of automotive parts and components, according to the UNCTAD report. The continent also contains 48pc of global cobalt reserves, 47.6pc of manganese reserves, and over 80pc of phosphate rock reserves as well as platinum group metals.

"[But] this new opportunity for African countries to participate in high-value global supply chains cannot be realized without equal terms of mining contracts and policies that can catalyse lateral linkages between large-scale mining and local productive industrial development," Grynspan added.

Competitive advantages

The report suggested that African countries make deals with automotive and battery producers to acquire technology and knowledge, while engaging in domestic processing.

National incentives and regional cooperation can help domestic companies to gain a competitive advantage if they were provided preferential access to local resources, such as specific percentages of mining products that must be used or transformed locally, the report added, which strongly echoes the US' Inflation Reduction Act.

Morocco in June signed a $6.4bn agreement with China-based battery maker Gotion High Tech to build a battery gigafactory that can have up to 100 GWh/yr of production capacity, according to the nation's investment agency.

The report suggested the development of new vehicle-financing mechanisms to boost domestic automotive demand and to cluster automotive production through special economic zones (SEZ) and industrial parks. A new battery SEZ dedicated to producing battery precursors, batteries, and EVs was established between Congo and Zambia in April. It will be facilitated by the African Export-Import Bank and the United Nations Economic Commission for Africa, according to the UN.

The report lastly called for support for African nations in negotiations of mining contracts to ensure fair value from extractive industries.

By Joseph Ho

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22/11/24

Cop 29 goes into overtime on finance deadlock

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Cop: Drafts point to trade-off on finance, fossil fuels

22/11/24

Cop: Drafts point to trade-off on finance, fossil fuels

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US alleges Nippon dumped HRC at higher rates

21/11/24

US alleges Nippon dumped HRC at higher rates

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Recent deep-sea and short-sea cfr Turkey scrap deals

21/11/24

Recent deep-sea and short-sea cfr Turkey scrap deals

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Cop: EU, four countries commit to 1.5°C climate plans

21/11/24

Cop: EU, four countries commit to 1.5°C climate plans

Baku, 21 November (Argus) — The EU, Canada, Mexico, Norway and Switzerland have committed to submit new national climate plans setting out "steep emission cuts", that are consistent with the global 1.5°C temperature increase limit sought by the Paris Agreement. The EU and four countries made the pledge at the UN Cop 29 climate summit in Baku, Azerbaijan today, and called on other nations to follow suit — particularly major economies. Countries are due to submit new climate plans — known as nationally determined contributions (NDCs) — covering 2035 goals to the UN climate body the UNFCCC by early next year. The EU, Canada, Mexico, Norway and Switzerland have not yet submitted their plans, but they will be aligned with a 1.5°C pathway, EU climate commissioner Wopke Hoekstra said today. The Paris climate agreement seeks to limit the global rise in temperature to "well below" 2°C and preferably to 1.5°C. Canada's NDC is being considered by the country's cabinet and will be submitted by the 10 February deadline, Canadian ambassador for climate change Catherine Stewart said today. Switzerland's new NDC will also be submitted by the deadline, the country's representative confirmed. Pamana's special representative for climate change Juan Carlos Monterrey Gomez also joined the press conference today. Panama, which is designated as carbon negative, submitted an updated NDC in June. It is planning to submit a nature pledge, Monterrey Gomez said. "It is time to streamline processes to get to real action", he added. The UK also backed the pledge. The UK announced an ambitious emissions reduction target last week. The UAE — which hosted Cop 28 last year — released a new NDC just ahead of Cop 29, while Brazil, host of next year's Cop 30, released its new NDC on 13 November during the summit. Thailand yesterday at Cop 29 communicated a new emissions reduction target . Indonesia last week said that it intends to submit its updated NDC ahead of the February deadline, with a plan placing a ceiling on emissions and covering all greenhouse gases as well as including the oil and gas sector. Colombia also indicated that its new climate plan will seek to address fossil fuels, but it will submit its NDC by June next year . By Georgia Gratton Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

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