Africa warned against imposing export bans on minerals

According to Benedikt Sobotka of the Kazakh mining company Eurasian Resources Group (ERG), the number of African nations that have imposed and subsequently lifted mineral export prohibitions suggests that they are not always advantageous.

export bans

Following Namibia and Zimbabwe, who had both prohibited the sale of raw lithium many months prior, Ghana banned the export of a number of raw minerals, including lithium, in June 2023.

Speaking this week at the Mining Indaba conference, Sobotka and Absa Corporate Investment Banking banker Shirley Webber stated that the growth of a downstream minerals industry required a stable electrical supply in addition to freight and port facilities.

Although Indonesia’s downstream processing sector is well-developed, it required $15 billion in development capital to get started. However, there is a catch to Indonesia’s beneficiation success, according to Sobotka: because its processing plants rely on coal-fired power generation, the country’s green mineral processing is extremely carbon intensive.

Given that nations in the European Union have begun implementing the first phase of the Carbon Border Tax Adjustment Mechanism (CBAM), which implies that there will be a premium on carbon-intensive imported goods entering the EU, this presents a substantial concern.

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The African Development Bank stated during last year’s COP28 meeting in Dubai that Africa stand to lose up to $25bn per annum as a direct result of the EU’s carbon tax.

According to Webber, Africa needs to learn that beneficiation of green metals is dependent on renewable energy sources. African nations should work together in regional beneficiation hubs, like Zambia and the Congo, to develop precursor minerals for nickel, manganese, and cobalt batteries.

Mining attorney Hulme Scholes stated in a separate discussion on resource nationalism surrounding mineral assets that governments should generally refrain from becoming involved in any kind of mining activity, save from creating an investment-friendly environment through reasonable taxation, an easy-to-use mining licensing system, an online geological database, and a stable royalty rate.

Additionally, Scholes disapproved of the necessity of beneficiation. “If the state of the market dictates that beneficiation makes sense, then proceed.”

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