Niger: Will Rare-Earth minerals increase Africa’s geo-political bargain power in the world?

Samuel Obedgiu

In light of the recent events in Niger following last month's coup, one cannot help but recognize the stark imbalances present within the contemporary global order. For years, Niger has been cast as the world's poorest nation, where its population has endured lives plagued by abject poverty. However, akin to numerous African nations, its leaders have managed to maintain comfortable lifestyles, while external beneficiaries such as France have capitalized on transactions that left Niger shortchanged.

This nation, often overshadowed due to its ongoing economic struggles, has now become the focal point for a competition involving the USA, EU, France, and Russia, all vying for control. Employing local proxies, these foreign powers are utilizing their influence to ensure that whoever secures the seat in Niamey aligns with their interests, whether under the guise of democracy or autocracy. The underlying truth is that this race for dominance in Niger is not rooted in a desire to rescue its populace or uplift them from impoverishment; rather, it is a calculated pursuit to exploit its mineral wealth.

With an impressive reserve of 60,000 tonnes of uranium, Niger holds the global rank of fourth in this critical resource. Uranium is a vital component for fueling nuclear reactors, which play a substantial role in generating a significant portion of the world's electricity. As the demand for clean energy continues to escalate, uranium's importance grows even more pronounced. Ordinarily, a nation in possession of uranium resources would leverage them to bolster their energy security. However, Niger's circumstance diverges from the norm. The nation predominantly relies on Nigeria's hydropower, which has, in turn, been manipulated as a weapon in this race for control. On the flip side, France, the world's largest consumer of nuclear energy, heavily depends on Niger. Yet, these trade dynamics have not translated into substantial benefits for the country. Regrettably, this scenario resonates with numerous other countries across Africa and the broader global context.

Recently, I came across an article on the Brookings Institution's website, a prominent American think-tank. The article is titled "Could Africa Replace China as the World's Source of Rare Earth Elements?" The title succinctly indicates the content's focus. Presently, the production of rare earth minerals remains heavily concentrated in China, a matter of substantial concern for Western nations and their allies. China currently commands a staggering 60% share of global rare earth mineral production and an even more significant 85% of processing capacity.

For those unfamiliar with rare earth minerals, their significance can be grasped by considering their applications. Rare earth elements, a group of 17 metals, find use in various critical sectors. They are integral to electronics, powering devices like computers, televisions, and smartphones. Moreover, they play a pivotal role in renewable energy technologies, such as wind turbines, solar panels, and electric vehicle batteries. Additionally, rare earth elements are vital in national defense, contributing to essential components like jet engines, missile guidance and defense systems, satellites, GPS equipment, and more. The control of both the production and processing of these rare earth minerals translates to control over the trajectory of future technology. This reality underscores the reason behind the discontent in the West regarding China's monopoly on these resources.

From my personal standpoint, it appears that African leaders might not be strategically capitalizing on the geo-political struggle over rare earth minerals to the advantage of their populations. The untapped potential of Africa in the realm of rare earths is quite pronounced due to the limited levels of exploration undertaken thus far. African governments and the private sector currently allocate modest budgets for the exploration of rare earth minerals, resulting in a situation where foreign governments and companies spearhead the bulk of exploration efforts.

For instance, a notable case is that of Mkango Resources, a Canadian exploration company, which disclosed in 2022 its plans to initiate production at the Songwe Hill rare earths mine in Malawi by 2025. Similarly, Bannerman Energy, an Australian firm, made headlines with its acquisition of a 41.8% stake in Namibia Critical Metals, the owner of 95% of the Lofdal heavy rare earths operation. This particular mine yields a yearly output of 2,000 tons of rare earth oxides and boasts abundant deposits of two prized heavy rare earth metals, dysprosium and terbium.

In another notable instance, the Angolan subsidiary of Pensana Rare Earths, a British company, secured exclusive mining rights for the Longonjo Mine in 2020—a rare earths operation granted for a substantial 35-year timeframe. These deposits are far from insignificant, especially when considering Africa's relatively modest share of global exploration efforts.

One very frightening statistic we have to bear at the back of our minds is that for the next 3 decades, the world will consume more metals and minerals than all the metals and minerals we have ever consumed for the last 70,000 years, since the beginning of humankind.

One major reason I believe that these rare earth minerals wont transform the Geo-political bargaining position of most African governments and livelihood of Africans is due to the governance question. Take this for an example, the Democratic Republic of Congo is responsible for 70% of the global production of cobalt – a rare earth mineral that’s vital for batteries in most electronics.

However, its Glencore plc, a Swiss multinational commodity trading and mining company, listed on the London stock exchange, that dominates cobalt exploitation in DRC. The second biggest company that dominates cobalt exploitation is China Molybdenum Group Limited, that’s listed on the Hong Kong Stock Exchange and Shanghai Stock Exchange.

The Congolese cobalt situation is interesting, like one man put it, “china exploits the land for rare earths minerals, and the Congolese children provide cheap labour.” China and all these other western actors don’t process the cobalt in Congo that would be good for the Congolese, in order to make the added value to stay for export. China and these western companies export the raw cobalt and do the processing back in their homes. This means that African people are left without any skill development in this rare earths supply-chain. The children simply provide cheap labour. This doesn’t transform the counties.

African nations appear to struggle with organizational challenges that hinder their ability to fully capitalize on the potential benefits offered by the presence of rare earth minerals within their borders. To effectively address this issue, it is imperative for these countries to formulate and implement well-crafted policies aimed at mitigating the influx of speculative capital that tends to flow in and out rapidly. The realization of desired outcomes hinges on the ability of African countries to successfully enforce the requisite mineral policies once they are established. Perhaps, the recent fervor surrounding Niger serves as a poignant reminder of the profound significance and untapped wealth inherent even within the seemingly least affluent nations.