Africa’s Top Mining Opportunities


Africa is rich in resource wealth. It is estimated to contain 30 percent of the world’s mineral resources, including bauxite, cobalt, copper, gold, graphite, iron ore, manganese, nickel, phosphate, platinum and many other rare metals and elements. Since 2000, the mining of natural resources have accounted for 35 percent of Africa’s growth. Still multinationals companies and international investors alike however remain cautious about mining on the continent for legitimate reasons: infrastructure challenges (e.g. power, transport), education, and law/politics. That said, the opportunity is greater than the challenges and African leaders are ready to turn potential into results. Mining and quarrying currently account for about 20 percent of Africa’s economic activity and 10 percent of the continent’s total export earnings – only trailing the lucrative but currently struggling oil & gas sector. Those percentages should grow in the next few years.

This article looks at the best countries vying to attract greater international investment in the mining sector:


Heralded for its gem quality, Namibia stands high as one of the five largest producers in diamonds and uranium. Lower commodity prices have slightly hurt national revenue but done little to subdue the national spending plan – government officials and industry leaders have maintained most preplanned investments in the mining sector (and even added a few new projects).

Namibian Minister of Mines and Energy Obed Kandjoze remains adamant that the sector will diversify and work effectively under a collaborative leadership. The recent mining expo organized by the Chamber of Mines of Namibia represents this idealism as every mining and exploration company in Namibia is generally a member of the chamber, which enables one voice for the industry. The government and company leaders speaking at the expo furthermore highlighted the strong engagement between both sides.

The $400 million Otjikoto gold mine project, being built by Canadian listed B2Gold, and the $2 billion Husab uranium mine project have great regional buy-in and local collaboration between leaders and company representatives. Namdeb, a 50-50 joint venture between the government and De Beers that mimics a similar diamond mining model in Botswana, also represents the sector’s strong company and government leadership.

London based Weatherly International’s $89 million investment in Namibia’s first refined copper project best represents the opportunity for diversification. Manganese and iron ore are also other opportunities to help diversify the country’s production. A closeness to South Africa and consequently access to equipment combined with new infrastructure coming on line bids well for future success. Training up labour may be the biggest challenge in the long run but the government is making plans to address that issue.


Botswana is the favourite of the favourites. Similar to Namibia, the country has a long history of diamond mining. The 50-50 joint venture between the government and De Beers has generally been described as an example of how governments can engage multinational diamond companies. The government no longer sells all the diamonds from Debswana to De Beers, electing to sell some diamonds to its growing government entity Okavango Diamond Trading Company. The company currently buys around 14 percent of the produced value. All this highlights why diamond production has fuelled the economy during the past decade, generally accounting for 70 percent of the country’s total export earnings.

Diversification is the push from leadership in the government and in the mining industry, reinforced by strong financial support from the government. A history of transparency and sophistication in business and politics has encouraged the arrival of various exploration companies, which is vital to the country’s expressed aspiration to become a hub for Southern Africa, specifically in the sense of mining and moreover finance. Its competitive strength against neighbouring South Africa may simply be that it is already a strong competitor with only have touched the surface of potential.

Although Botswana is home to one of the largest coal deposits in Africa, infrastructure however must improve to support any aspiration to be a global coal producer. The country, most importantly, requires a railway line to move coal from, at least, the landlocked border of Botswana to the coast of the continent, let alone within the country. It is a huge bill for this emerging economy but the investment ‘pays it forward’ in many ways. Not only will this boost the coal sector and national revenues, it all but guarantees Botswana becomes an energy hub, exporting to energy starved countries such as South Africa and Mozambique.


Over the last several years, Zambia has proven to be one of Africa’s most politically stable countries. The death of President Michael Sata (on October 24, 2014), the installation of Guy Scott (Zambia’s first white president post-independence) as acting president, and the subsequent special election of Edgar Lungu in January 2015 did little to disturb the country or that reputation.

The investment community is eager to see if the economy however can withstand the headwinds against it. After achieving 6.5 percent growth in 2013 and 5.6 percent growth in 2014, the country could endure its toughest year economically in a while, as agriculture – central to the past two years of growth – has eased somewhat in 2015 due to adverse weather conditions and continuing electricity outages.

Officials understandably have turned their focus to the mining sector. But the price of its biggest export mineral, copper, has struggled steadily after strong start into the year – rallying from a low at end of January to a 2015 high in May but hitting a new low for the year at the end of July. It is important that the country leverage the wealth of copper, particularly in future price rebounds, to diversify its mining sector.

Copper, in accordance with previous years, will account again for an estimated 75 percent of the country’s total export earnings in 2015. But that statistic should not overshadow the country’s wide range of mineral wealth, including coal gemstones, gold, lead and zinc. Although the country lacks the capacity, specifically infrastructure, to become a global leader in coal, the resource itself could be vital to the country jumping the hurdle with its electricity struggles. Better license processes and protections could help gold.


Known for its serene beaches and a growing amount of skyscrapers along its skyline, Mozambique is the country likely to makes the greatest leap from its current level of production in the next several years. The country is projected to be a top 10 coal producer by 2017 with nearly 42 million tons – a significant amount of the reserves sits in the Tete province and Zambezi area. A recent sale by Rio Tinto of its main operations to India’s International Coal Venture Private (ICVL) however raised eyebrows for its price and the reason –i.e, lack of infrastructure and consequent struggle with achieving profits. Brazil’s Vale has stayed in the coal mining business but also raised similar gripes.

Infrastructure accordingly rises to the top of the agenda for this emerging economy. Hampered by a history of Portuguese colonialism and a vicious civil war, it comes as no surprise that infrastructure costs are so high – the private sector pledges for infrastructure investment have surged towards $35 billion by 2020. The demand for power – also an input factor in coal mining – is growing at a rate of 15 percent per year, with more than half of Mozambique’s electricity exported to South Africa and less than 40 percent of Mozambicans having access to electricity in Mozambique.

Transport is second biggest challenge after power. Moving workers and product can be very costly. The Sena line still floods three months yearly and the transport fees are uneconomic for some producers in the short term – i.e., Rio Tinto. If the country is to keep the momentum, jumping the infrastructure hurdle will be vital.

A projected 8 percent-plus GDP growth in 2015 and beyond is attainable. Although currently at a low level, an expansion in gold and aluminium production will buffer any mishaps with coal production growth in the short term. Over the long term, it should all come together well – naysayers, relying on significant historical reasons, should look at the maturation of the Mozambique political process and see how quick things change.


Guinea is a part-sentimental pick, considering how the Ebola outbreak financially and emotionally bankrupted the country for a short period. It is also a legitimate contender in the mining space. Although the most underdeveloped country on this list, it makes up for it in potential – it is home to one-third of the global bauxite resources and the world’s largest undeveloped iron project at Simandou. The undeveloped Simandou project is worth approximately $25 billion with the government working to install a legitimate operator, e.g. Rio Tinto, to get the project running at full strength.

Economic growth, projected at 4.5 percent at the start of 2014, fell below 0.6 percent by the end of the 2014. The outlook for 2015 is better per se at 0.9 percent. However in order to leapfrog 4-plus percent GDP growth in 2016, infrastructure investment, i.e. 650 km railway with 30+ bridges and 24km of tunnel, and partnership with a multinational will be vital. It is all possible and Guinean leadership appears prepared to negotiate with partners to get there.

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