{"id":21987,"date":"2026-09-09T13:37:35","date_gmt":"2026-09-09T13:37:35","guid":{"rendered":"https:\/\/qiraatafrican.com\/en\/?p=21987"},"modified":"2026-09-09T13:37:35","modified_gmt":"2026-09-09T13:37:35","slug":"mineral-beneficiation-a-pipedream-of-prosperity-in-an-unequal-financial-architecture","status":"publish","type":"post","link":"https:\/\/qiraatafrican.com\/en\/21987\/mineral-beneficiation-a-pipedream-of-prosperity-in-an-unequal-financial-architecture\/","title":{"rendered":"Mineral Beneficiation: A Pipedream of Prosperity in an Unequal Financial Architecture"},"content":{"rendered":"

By Siddharth Akali<\/a>*<\/strong><\/em><\/p>\n

 <\/p>\n

Since 2023,\u00a014 African countries<\/a>\u00a0have introduced\u00a0export restrictions\u00a0<\/a>on unprocessed critical minerals, requiring \u201clocal beneficiation\u201d \u2013 or in-country processing and manufacturing \u2013 prior to export, and demanding technology and financing.<\/p>\n

Wealthier countries are also supporting the idea of local beneficiation and stepping up investments in resource-rich countries, promising this will help to lift them out of poverty. Behind these promises, however, they are perpetuating a top-down, economic model that only serves their own interests, and are reducing long-standing equity-based claims for climate justice and reparations from the Global South to a business opportunity.<\/p>\n

Promoted by Western governments and executed through their development banks and corporations, this model pushes African countries further into debt, allows wealth to flow out through tax avoidance, and imposes policy changes that undermine environmental and human rights, while diverting scarce public resources away from hospitals, schools and social protection.<\/p>\n

Geopolitical interests at stake<\/strong><\/h2>\n

Currently, China is one of the world\u2019s largest producers and suppliers of critical minerals,\u00a0controlling over 80 % of the rare earth element supply<\/a>. In response, Western nations in the\u00a0G7<\/a>\u00a0and their allies \u2013 who need to\u00a0secure access<\/a>\u00a0to minerals for their growing energy,\u00a0digital<\/a>\u00a0and\u00a0military<\/a>\u00a0industries \u2013 are trying to\u00a0reduce their dependency on China<\/a>\u00a0and stepping up investments in the mining sector across the Global South.<\/p>\n

Amidst these geopolitical tensions, multilateral development banks (MDBs) are increasingly being used as a tool to advance Western government interests. In May 2026, the World Bank Group announced it \u201cwill quintuple support to the sector in the next five years<\/a>\u201d, while the African Development Bank is working to make\u00a0critical minerals beneficiation central to Africa\u2019s industrialisation<\/a>.<\/p>\n

Development banks are mobilising support for mining and beneficiation in three main ways. Firstly, identifying and designing projects that can fit into global supply chains and are profitable for the private sector. Secondly, providing host governments loans to\u00a0absorb risks from the private sector<\/a>\u00a0through\u00a0public private partnerships<\/a>, and set up the associated energy and transportation infrastructure. Thirdly, under the guise of providing \u201ctechnical assistance\u201d as well as the conditionalities attached to loans, MDBs end up acting as\u00a0shadow governments<\/a>\u00a0and pressure African governments to make industry-friendly reforms, including measures to fast-track projects.<\/p>\n

A promise based on false assumptions<\/strong><\/h2>\n

MDBs are opportunistically presenting critical minerals as a golden development opportunity for Africa. Their promises of prosperity, however, are built on two faulty assumptions.<\/p>\n

The first is that there is infinite demand for critical minerals. In reality, projected demand has been overblown, leading to overinvestment in production capacity. For example, global\u00a0manufacturing capacity for lithium-ion batteries<\/a>\u00a0is about two to five times greater than current demand, resulting in waste, overextraction, overproduction and lower prices. This suggests that mineral-rich countries will need to\u00a0increase demand domestically<\/a>, factoring in higher competition and reduced income for their products.<\/p>\n

The second is that mineral-rich countries will be able to fund their essential social services and infrastructure through income from mining and beneficiation. However, debt servicing and the global tax framework (with business structures channelling profits to offshore investors) will likely suck up any economic value before reaching the marginalized communities who are facing poverty.<\/p>\n

Unfair global tax and debt systems undermine public financing for development<\/strong><\/h2>\n

MDBs have historically pushed for extractive industries to be\u00a0private sector-led<\/a>, leaving governments at the mercy of mega mining-corporations whose capital far exceeds the gross domestic product of many African countries. These corporations are pushing mining host governments\u00a0to compete with each other<\/a>\u00a0for more investments by reducing resource royalties, weakening environmental and social safeguards, and giving tax breaks to resource companies.<\/p>\n

Significant portions of mining value continue to flow out as companies\u00a0shift their profits to tax havens<\/a>. Meanwhile the G7 and other wealthy countries\u00a0have resisted efforts<\/a>\u00a0by Global South countries to increase their public revenues and tackle illicit financial flows through an inclusive, centralised UN tax convention, which would enable resource-rich countries to tax economic activities and profits generated inside their borders.<\/p>\n

Additionally,\u00a0key proposals for financing green industrial policy<\/a>\u00a0are further adding to African countries\u2019 debt burdens. Even when projects are implemented by private companies, governments are still expected to take on\u00a0loans<\/a>\u00a0to develop the supporting transportation and energy infrastructure. These debts are usually denominated in U.S. dollars, making it harder for countries to pay back the loans: the more debt they take on, the more their currency devalues against the U.S. dollar. Often the original creditors, who tend to be long-term institutional investors or governments, sell the debt at deep discounts for pennies on the dollar, leaving countries at the mercy of\u00a0vulture funds<\/a>\u00a0who doggedly litigate to claim their full pound of flesh.<\/p>\n

The focus on debt financing also means that only those projects that are profitable get financed; while others, including essential services like health and education, get left by the wayside. Cases such as\u00a0Mozambique<\/a>\u00a0show that public services end up being cut when the promised income from resource extraction does not materialise. And in the absence of a functioning\u00a0sovereign debt restructuring mechanism<\/a>, countries need to pay back their debts before directing any increased income to public services.<\/p>\n

More meaningful community participation is needed for beneficiation to benefit people<\/strong><\/h2>\n

Within this deeply unfair economic system, the biggest hypocrisy is that local communities and indigenous peoples \u2013 who are being promised prosperity in exchange for giving up their lands, ecological resources and livelihoods \u2013 are being actively excluded from decision-making processes around critical minerals and beneficiation projects.<\/p>\n

MDBs pay lip service to improving environmental and safeguards, but then advise countries to reduce opportunities for public participation and access to information, citing the urgency of the climate crisis or the business case for\u00a0streamlining environmental approval<\/a>. As a result, those who are bearing the cost of projects on their land do not have opportunities to share their knowledge, present their concerns and meaningfully participate.<\/p>\n

Secondly, environmental and human rights defenders are being stigmatised, accused of being \u201canti-development\u201d, criminalized and\u00a0attacked<\/a>, for simply asking questions or suggesting how to improve green industrial projects. Governments are also\u00a0pushing forward laws<\/a>\u00a0that improperly regulate civil society organisations in ways that limit their autonomy and independence and threaten their existence.<\/p>\n

This silencing of communities and movements is restricting their ability to have a say in their own survival. It also breaks down trust and accountability required to ensure green industrialisation generates real prosperity for all.<\/p>\n

Resource rich countries must use their leverage to push for systemic reform and transformation<\/strong><\/h2>\n

Local beneficiation is high up on the international agenda, from the declarations at the latest\u00a0G7<\/a>\u00a0and\u00a0G20<\/a>\u00a0meetings, to the more progressive stances in the African Union (AU)\u2019s \u201cGreen Mineral Strategy<\/a>\u201d and the UN\u2019s\u00a0High Level Meeting on Critical Energy Transition Minerals<\/a>.<\/p>\n

But none of these fora are centering the need for systematic reform of the current financial architecture. There are parallel conversations around increasing public resources through debt and tax reform, but these are decoupled from conversations on beneficiation. Meanwhile, it is noteworthy that in these parallel conversations, China is supporting a\u00a0UN debt workout mechanism<\/a>\u00a0and\u00a0UN tax convention<\/a>, while the G7 countries are opposing these reforms. Given that China is already the market leader in critical minerals, African countries could pressure the G7 to change their position in exchange for greater critical mineral access.<\/p>\n

One thing is clear: export bans are not enough.Without transformational reforms of this system, the promised wealth supposed to trickle down from critical minerals is not going to lift communities and countries out of poverty.<\/p>\n

African countries and communities should demand three main systemic changes as a prerequisite to contributing to critical minerals supply chains. Firstly, they must push for an equitable global tax framework, to force resource-hungry billionaires and their companies to pay their fair share of taxes. Secondly, they should demand a sovereign debt workout mechanism, to free up sufficient public resources and guarantee\u00a0universal social protection<\/a>. Finally, governments and public financiers should take a more\u00a0community-led approach to transform development<\/a>, and provide direct, grant-based funding for communities\u2019 self-determined priorities. Local communities and Indigenous Peoples want information, meaningful decision-making power, and safe opportunities to shape their own development pathways. The goal should shift from how many tons of minerals are processed locally, to whether local communities in resource-rich territories can access food, water, energy, hospitals and schools.<\/p>\n

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* An international lawyer who has been trained by local communities, Indigenous governments and peoples in Canada, India and Nepal.<\/em><\/p>\n","protected":false},"excerpt":{"rendered":"

African countries and communities should demand three main systemic changes as a prerequisite to contributing to critical minerals supply chains. Firstly, they must push for an equitable global tax framework, to force resource-hungry billionaires and their companies to pay their fair share of taxes. Secondly, they should demand a sovereign debt workout mechanism, to free up sufficient public resources and guarantee\u00a0universal social protection. Finally, governments and public financiers should take a more\u00a0community-led approach to transform development, and provide direct, grant-based funding for communities\u2019 self-determined priorities. Local communities and Indigenous Peoples want information, meaningful decision-making power, and safe opportunities to shape their own development pathways. The goal should shift from how many tons of minerals are processed locally, to whether local communities in resource-rich territories can access food, water, energy, hospitals and schools.<\/p>\n","protected":false},"author":1,"featured_media":20883,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"iawp_total_views":20,"jnews-multi-image_gallery":[],"jnews_single_post":{"format":"standard","override":[{"template":"1","parallax":"1","fullscreen":"1","layout":"right-sidebar","sidebar":"default-sidebar","second_sidebar":"default-sidebar","sticky_sidebar":"1","share_position":"top","share_float_style":"share-monocrhome","show_featured":"1","show_post_meta":"1","show_post_author_image":"1","show_post_date":"1","post_date_format":"default","post_date_format_custom":"Y\/m\/d","show_post_reading_time":"0","post_reading_time_wpm":"300","post_calculate_word_method":"str_word_count","show_zoom_button":"0","zoom_button_out_step":"2","zoom_button_in_step":"3","show_post_tag":"1","show_comment_section":"1","number_popup_post":"1","show_post_related":"1","show_inline_post_related":"1"}],"image_override":[{"single_post_thumbnail_size":"crop-500","single_post_gallery_size":"crop-500"}],"trending_post_position":"meta","trending_post_label":"Trending","sponsored_post_label":"Sponsored by","disable_ad":"0","source_name":"African Arguments","source_url":"https:\/\/africanarguments.org\/2026\/09\/mineral-beneficiation-a-pipedream-of-prosperity-in-an-unequal-financial-architecture\/","subtitle":""},"jnews_primary_category":[],"jnews_social_meta":[],"jnews_override_counter":{"view_counter_number":"0","share_counter_number":"0","like_counter_number":"0","dislike_counter_number":"0"},"footnotes":""},"categories":[28,29,36,30,27],"tags":[396,3226,5447,5448],"class_list":["post-21987","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-central-africa","category-east-africa","category-ana-economy","category-southern-africa","category-west-africa","tag-china","tag-global-south","tag-mineral-beneficiation","tag-multilateral-development-banks"],"_links":{"self":[{"href":"https:\/\/qiraatafrican.com\/en\/wp-json\/wp\/v2\/posts\/21987","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/qiraatafrican.com\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/qiraatafrican.com\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/qiraatafrican.com\/en\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/qiraatafrican.com\/en\/wp-json\/wp\/v2\/comments?post=21987"}],"version-history":[{"count":1,"href":"https:\/\/qiraatafrican.com\/en\/wp-json\/wp\/v2\/posts\/21987\/revisions"}],"predecessor-version":[{"id":21988,"href":"https:\/\/qiraatafrican.com\/en\/wp-json\/wp\/v2\/posts\/21987\/revisions\/21988"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/qiraatafrican.com\/en\/wp-json\/wp\/v2\/media\/20883"}],"wp:attachment":[{"href":"https:\/\/qiraatafrican.com\/en\/wp-json\/wp\/v2\/media?parent=21987"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/qiraatafrican.com\/en\/wp-json\/wp\/v2\/categories?post=21987"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/qiraatafrican.com\/en\/wp-json\/wp\/v2\/tags?post=21987"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}