Blitz Bureau
NEW DELHI:THE US International Development Finance Corporation (DFC) is backing a pipeline of African rareearth projects as private investors remain reluctant to finance the sector, according to Reuters.
The DFC has committed $62.8 million to rare-earth projects in Malawi, Angola, Madagascar and South Africa, though none has so far reached production, the agency said on August19. Most of that funding — about $50 million — was for the Phalaborwa project in South Africa backed by Dublin-based mining investor TechMet.
Private investors remain largely unwilling to fund African rare-earth projects despite their strategic importance in reducing US dependence on top producer China, which dominates the global supply chain and has over the past couple of years tightened export controls.
Rare earths are essential for magnets used in electric vehicles, wind turbines and defence systems. The United States is increasingly using the DFC to help develop Westernaligned supply chains for critical minerals.
“There are far more announced rare-earth projects than there is demand for neodymium-praseodymium (NdPr) magnets,” said Olimpia Pilch, head of strategy at advocacy group Critical Minerals Africa.
Africa accounts for roughly 20 per cent to 25 per cent of DFC’s global investment portfolio.
Africa holds about 30 per cent of the global reserves of critical energy transition minerals, including cobalt, copper, graphite, lithium, manganese, nickel, platinum group metals and rare earth elements. It produces more than 77 per cent of the world’s cobalt, 21 per cent of its natural graphite, 1 per cent of its lithium, 65 per cent of its manganese, 5.6 per cent of its nickel and 83 per cent of its platinum group metals.
Huge demand
The International Energy Agency projects that demand for these minerals could more than triple by 2030 under net-zero scenarios. Major economies are already repositioning supply chains in the name of energy security.
