19 February 2025 - Public Development Banks (PDBs) can play a more transformative role in advancing green industrialisation in emerging markets, particularly through investments in critical minerals. Africa’s wealth of essential minerals like lithium, cobalt, copper, and nickel positions the continent as a pivotal player in the global shift towards a low-carbon economy. These minerals are vital for technologies such as electric vehicles, portable electronics, and battery storage, with demand projected to soar by 2030.
However, Africa faces a dual challenge: while it is mineral-rich, it remains infrastructure-poor. This underscores the importance of beneficiation at the source, processing minerals locally before export. Beneficiation not only enhances the value of raw materials but also creates jobs, stimulates local economies, and fosters industrialisation. Globally, beneficiation is increasingly recognised as a key driver of economic growth in conversations around critical mineral. And Africa has a unique opportunity to lead by example.
The need to balance availability, affordability, and sustainability in the minerals market is pressing. Transition finance offers a critical solution by mobilising capital for sustainable infrastructure, incentivising responsible extraction, and ensuring equitable access to green technologies. It bridges gaps in mineral supply chains, lowers the costs of green technologies, and mitigates environmental and social risks, all while advancing long-term sustainable development.
The Finance in Common Summit 2025 (FiCS 2025) co-hosted by the Development Bank of Southern Africa (DBSA), the Asian Infrastructure Investment Bank (AIIB), and Agence Française de Développement (AFD), will elevate the dialogue on critical minerals. While discussions have gained prominence at forums like Davos, the World Economic Forum (WEF), and G20, FiCS 2025 will spotlight the role of PDBs and the urgent need for collaborative efforts to achieve a fair and sustainable green transition.
PDBs are uniquely positioned to catalyse this transformation by fostering partnerships among governments, businesses, investors, and local communities. The DBSA exemplifies this approach by financing renewable energy and sustainable projects across the continent. For instance, the Kouilou Solar Power Project in the Republic of Congo supports clean energy generation while creating local jobs. Similarly, South Africa’s Renewable Energy Independent Power Producers Procurement Programme (REIPPPP) has resulted in large-scale wind, solar, and photovoltaic projects, boosting energy capacity, job creation, and community development.
Projects like Zambia’s Copperbelt Energy Corporation (CEC) focus on energy-efficient technologies and reducing emissions, ensuring that mineral extraction does not compromise local ecosystems or communities. Beneficiation at the source further amplifies these efforts by maximising the economic value retained within Africa, reducing dependency on raw material exports, and driving industrialisation.
To fund such initiatives, the financial community must leverage instruments like Green Bonds, which raise capital for environmentally sustainable projects, and Blended Finance, which combines public and private funding to de-risk investments in high-impact projects. Transition finance, paired with beneficiation, will ensure that Africa’s mineral wealth translates into long-term, inclusive growth and development.
As the global demand for critical minerals intensifies, the role of PDBs in supporting sustainable extraction and beneficiation at the source will be pivotal. Through strategic investments and collaborative partnerships, Africa will transform its resource wealth into a driver of green industrialisation, equitable economic growth, and a sustainable future for generations to come.
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About the Development Bank of Southern Africa
The Development Bank of Southern Africa (DBSA) is a leading Development Finance Institution (DFI), wholly owned by the government of South Africa. Established in 1983, the DBSA is mandated to promote economic growth and regional integration by mobilising financial and other resources from national and international private and public sectors for sustainable development projects and programmes in South Africa, SADC, and the wider African continent. www.dbsa.org