Africa’s Natural Resources: a need for two-sided sustainability

 

Africa’s Natural Resources: a need for two-sided sustainability

 

Based on GDP, in 2013 17 out of 20 of the poorest countries in the world were located on the African continent. This manifestation of poverty in Africa could be conceived as strange when looking at the richness that the continent contains in one of the most profiting sectors in world-economy: natural resources.

The African soil is filled with an incredible amount of natural resources. The two major natural resources on the African continent are metals and minerals. The most important metals exported by African countries include:

 

  • uranium, used to produce nuclear energy, ammunition, and armor and shielding material;

  • platinum, used in jewelry and industrial applications. Africa has over 90% of the world’s platinum reserves.

  • nickel, used in stainless steel, magnets, coins, and rechargeable batteries;

  • bauxite, a main aluminum ore;

  • and cobalt, used in color pigments, of which Africa has over 60% of the world’s reserve.

 

Africa also inhabits over 30% of the world’s remaining mineral resources. Africa’s two most profitable mineral resources are gold and diamonds. In 2008, Africa produced about 483 tons of gold, or 22 percent of the world’s total production. In total Africa is estimated to contain 40% of the world’s gold reserves. For diamonds, in the same year this was 55%. Besides these big two Marocco also owns 2/3 of the world’s phosphorus resources, important as a resource for fertilizer.

 

Last but not least, two other big natural resources in Africa are oil and gas. In 2007, the continent produced 12.5 percent of the world’s total oil production and 6.45 percent of the world’s total natural gas production. Africa is an upcoming continent in oil exploration and many countries are looking to become first-time producers. In 2012, mining, oil and gas accounted for 28% of the continent’s GDP.

Despite the richness in natural resources, this richness is not reflected in the continent’s general wealth. Both economically as environmentally, the shine of the rich African soil does not reflect on the inhabitants of the continent. African natural resources scream for fairer and more sustainable treatment.

 

Who takes it all?

So if the African population doesn’t benefit from the richness that is under its feet, who does profit from Africa’s natural resources? In practice, the great industrial and political powers in the world are contending over the continent’s resources. Even though Africa’s natural resources are according to some the foundation of Africa of what people may call Africa as the ‘newest rising world economy’, the benefits of this natural wealth are mainly for actors outside the African continent. Africa is seen as thé new area to gain natural resources, and international industrial superpowers like Brazil, India, Russia and of course the United States are competing over the continent’s resources to not lose track of each other’s growth. Digging into the African resources is of great importance for the superpowers. Afraid to get behind on each other, Africa’s interest is sometimes lost out of sight. A challenge here is to find the right balance between ‘colonising’ Africa’s resources by foreign industrial powers, and creating alliances that let Africa itself benefit from her natural wealth as well. Sometimes, the interest of the African continent itself is lost out of sight.

 

Industrial superpowers

Let’s take China as an example. In her book ‘Winner take all’ (2012) Dambisa Moyo writes about the China’s Race for resources, among others on the African continent. Speaking from own expertise, during the 2011 African growth and Opportunity Act meeting in Africa, US Secretary of State Hillary Clinton cautioned that Africa must beware of ‘new colonialism’, implicitly referring to China. According to Moyo, China can’t be accused of ‘new colonialism’, because it is “too disinterested in the social and political constructs in many resource-rich countries” (…) Although the Chinese have generally eschewed aggressive pursuit of political control, they have, in a sense, been seen to flout labor laws while disregarding environmental concerns showing little interests in the politics of its host nations other than those that directly affect resource procurements”. China’s interests are driven only by their narrow motives of creating commercial relationships, with a complete disregard of the social, political and environmental situations of the African states it does business with.

Another example would be the United States. During his visit to the Addis Ababa diplomatic corps and the Young Africa leader network in Ethiopia, US Secretary of State John Kerry declared that the US is interested in Africa’s natural resources. Kerry said that the US and the continent of Africa are “Natural Partners” because of its abundant resources and their “know-how for economic development”. Kerry also highlighted crises in Nigeria, South Sudan, Somalia and the Central African Republic and urged Africans to demand stability and financial development. At the same time however, the United States supports states which according to the US’ own criteria are authoritarian regimes and dictatorships, solely with the purpose of acquiring important natural resources. As an example, one of USA’s closest allies is Teodoro Obiang Nguema Mbasogo of Equatorial Guinea in West Africa. Obiang is a staunch US ally and Africa’s longest ruling dictator since 1979 after he executed his uncle, Francisco Macías Nguema. The soil of Equatorial Guinea is full of natural resources, but can the economic benefit ever level the ethical downsides of a relationship like this?

 

New, sustainable alliances

The problem is not that a superpower like the US shouldn’t extract natural resources from the African continent. The issue at stake here is, if the US and other industrial powers take into account the interest of the African continent itself, and the importance of creating alliances and business models in which Africa also benefits from their own natural resources.

The point that needs to be made is not the point of right and wrong, and judging the industrial superpowers for seeing Africa as a new business opportunity is not the solution to the real problem. What we dó need to conclude is that the current coalitions in which Africa’s natural resources are being operated are not benefiting the African continent as much as they should do. The important conclusion for the future is that we need to reconstruct the current alliances that utilize Africa’s natural wealth, into alliances that empowers all levels of the continent to benefit from her rich soil. Industrial superpowers should be less focused on pure financial gain and need to have more attention for the impact of their business on the continent that blesses them with here natural wealth.

 

At the Addis Ababa conference mentioned above Kerry also said that “resource-money could build new schools and hospitals, new roads and bridges, new pipes and power lines. That’s why it’s a responsibility for citizens in Africa and in all nations to demand that public money is providing services for all, not lining the pockets of a few”. This statement beautifully illustrates the problem in the politico-economical balance of utilizing African resources at the moment. Kerry is right that Africa’s natural resources have great potential for the development of the country. The problem is that he appoints the responsibility for the greatest obstacle of this potential to the African people while in reality it is the superpowers like the United States who should carry that responsibility! How? By creating fair and sustainable alliances in which all layers of the African continent can benefit from the continent’s natural wealth.

 

Instead of disregarding and skipping the African countries in their business models, the big industrial powers should help African states in developing their own industries. Knowledge and expertise should be brought to the continent. Moreover, African parties should not be forced to directly sell their resources, but should instead be enabled to develop their resources into semi-manufactured goods that have higher added value. Lastly, better (inter)national policies in export-rates and –taxes are often seen as economic measures that could let Africa benefit optimally from its natural resources.

 

Urban mining and circular economies

Moreover, part of the solution lays outside of the African continent. To let their industries keep up with the economic growth, industrial powers should not only look for new primary resources in other parts of the world. The solution should be found in the internal material-policies of industries and states, and the use of secondary resources. ‘Urban Mining’ and the recuperation of materials will become more and more important as a solution for the increasing demand in resources. Trash does no longer exist, and every product should be the material-source of a new product at the end of its use. Smart design, and turning linear  production systems into circular ones are important developments that could create the fully circular economy for the future. Using more secondary materials in our own environment could take the pressure off the exploitation of the African soil, especially while Europe has hardly any natural resources anymore.

 

Although Africa’s rich soil sometimes seems to cause the continent more harm than good, the idea that its natural resources should in some form help the development of the country is omnipresent. Potentially, Africa’s richness in natural resources could be a part of the solution of a lot of the continent’s challenges. If the industrial superpowers want to use African resources, they should also take the responsibility to help Africa benefit from its rich soil by creating fair and sustainable alliances in operating the African soil. Optimization of knowledge and expertise, development of resources into semi-manufactured goods and better policies in export-rates and –taxes are economic measures that could let Africa benefit optimally from its natural resources, and are the developments in which the superpowers should support the continent with. Moreover, Urban Mining in the global West is a solution for the creation of a more sustainable, circular economic development without overly exploiting the African natural resources. This two-sided sustainability, both politico-economical by creating fairer alliances as well as environmental by investing in urban mining in Europe, will help both the big industrial powers as Africa move ahead.  

 

 

Vincent Oberdorf

FBBasic

In2Afrika Foundation