Africa is home to over 30 percent of the world’s known reserves of critical minerals. While international interest and investment in the African critical-minerals industry have been lagging, it is rapidly picking up; this is welcome news for resource-rich African nations.
But history shows that mining interest and investment—even if welcome—can have inadvertent negative effects.
In recent years, mines in the Democratic Republic of Congo (DRC), Zambia, and South Africa have been found to be polluting waterways, contributing to acid rain, and poisoning residents. Thus, investors should develop strategies surrounding mining projects that ensure African workers’ health is protected, the environment is not damaged, and the opinions of local communities are sought out, heard, and respected. In this way, it is hopeful that these African countries can avoid the “resource curse,” a term that refers to the failure of many resource-rich countries to fully benefit from their natural resources.
Botswana provides a positive example. In recent years, the country—one of the world’s leading producers of diamonds and also among the least corrupt on the African continent—has developed a “pro-equity based extractive sector strategy,” taking revenues from extractive sectors and investing them in health and education infrastructure and also into long-term savings through an asset fund. There are also various mechanisms and institutions set up to prevent or catch corruption, such as a constitutionally independent body in charge of cases of corruption. Botswana shows that strong business and the fight against corruption are perfectly compatible.
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