Process critical minerals before export, Okonjo-Iweala advises African nations

World Trade Organization Director-General Ngozi Okonjo-Iweala has strongly advised Nigeria and other African countries to process critical minerals before exporting them, arguing that the current model of raw extraction fuels instability and economic underperformance.

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One high potential sector is critical minerals, where the green transition is driving demand for lithium bauxite, cobalt, and other elements necessary to manufacture EV batteries and other low carbon goods.

Speaking at the 7th Africa Emerging Markets Forum in Abuja, Okonjo-Iweala, a former Nigerian Finance Minister, highlighted the immense potential of critical minerals like lithium and cobalt, essential for electric vehicle batteries and green energy goods. Africa holds an estimated 30 percent of the world's non-mineral reserves, presenting a significant opportunity.

"For Africa, in particular, instead of the extract and export model that has been the source of so much volatility, economic underperformance, and let me be blunt, corruption, conflict, and banditry, the goal should be higher value, higher productivity growth," she stated. She believes developing sub-regional value chains and integrating into global supply networks can drive this higher growth.

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Africa holds an estimated 30 percent of the world’s non-mineral reserves, and estimates for Latin America are similar.

Okonjo-Iweala emphasized the critical timing, as global geopolitics are pushing for supply chain diversification. "Quite frankly, the time to seize this opportunity is now... if we miss this opportunity, I'm afraid we would have missed a lot." She noted positive moves by countries like Morocco and efforts in Zambia, DRC, Mozambique, Angola, and Nigeria to add value to minerals, but called for more systematization and harmonization, including sub-regional approaches, to avoid suboptimal bilateral deals.

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For Africa, in particular, instead of the extract and export model that has been the source of so much volatility, economic underperformance, and let me be blunt, corruption, conflict, and banditry, the goal should be higher value, higher productivity growth, driven by the development of sub-regional value chains and integration into potential supply networks.

She also advocated for diversifying global trading partners to make the trading system more robust and resilient. This involves ensuring more countries and regions become substantial sources of global supply and demand, a concept she linked to "reglobalization" driven by companies seeking to reduce geopolitical risks. Harnessing Africa's renewable energy potential to power mineral processing could further enhance the continent's competitive advantage in the green transition.

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Quite frankly, the time to seize this opportunity is now, as geopolitics exerts some demand pressure for critical mineral supply chain diversification, if we miss this opportunity, I’m afraid we would have missed a lot.