DRC-USA mining agreement: optimism and inherent obstacles [Business Africa]

 

The Democratic Republic of Congo and the United States have signed a far-reaching agreement on critical minerals, promising economic transformation and secure supply chains.

Among other provisions, the agreement creates the Strategic mineral reserve (Strategic Mineral Reserve, SMR) to "ensure a predictable and sustainable supply of critical minerals, including cobalt, to the United States", while ensuring Americans preferential treatment in their exploitation and marketing.

The DRC is the world's leading producer of cobalt, a key material in electric vehicle batteries. With this agreement, the country now finds itself with the world's two largest economies competing for its minerals. The agreement appears aimed at curbing the expansion of chinese mining operations by securing broad policy, tax and regulatory incentives for U.S. operators, investors and buyers.

Geraud Neema analyzes the political economy of natural resources. He is also Africa editor-in-chief within the China-Global South Project, a US-registered organization that covers China's engagement with countries in the Global South. He joins the show to discuss the winners and losers of this deal.

Mineral diplomacy

African reserves of copper, cobalt and lithium are among the most important in the world.

But the lack of strong mining negotiation skills within African governments has led to significant potential revenue losses and compromised national interests in the mining sector.

Our report examines how African governments can exercise greater control, retain bargaining power and maximize value.

Sustainable mobility

Although it is an oil producer, the Senegal resolutely moving forward in the field of electric vehicles. This fast-growing market is driven by public orders as well as private initiatives.

However, this growth faces some obstacles, notably related to import costs and infrastructure, as reported Wahany Johnson Sambou from Dakar.