The race for critical minerals isn't just about what's in the ground. It's about who controls the future of green industrialization.
We're witnessing a paradoxical moment in mining investment. Global private equity and venture capital-backed investments in metals and mining plummeted to $152.8 million in Q1 2025, down from $4.35 billion in the same quarter of 2024. Yet industry analysts remain optimistic about critical minerals.
Why? Because the world is waking up to a fundamental reality: the energy transition depends on securing stable supplies of lithium, copper, rare earths, and other critical minerals.
But most Western investors are looking in the wrong places.
While private equity continues to favor North American and European projects, Africa offers extraordinary untapped potential. The continent has roughly 85% of the world's manganese, 80% of platinum and chromium, 47% of cobalt, 21% of graphite, and 6% of copper.
Africa is poised for an extraordinary critical minerals boom, with global revenues from just four key minerals—copper, nickel, cobalt, and lithium—estimated to total $16 trillion over the next 25 years. Sub-Saharan Africa is projected to capture over 10% of these cumulated revenues, potentially increasing the region's GDP by 12% or more by 2050.
Yet remarkably, the mining exploration budget in Sub-Saharan Africa remains the second lowest in the world. This disconnect between opportunity and investment stems from fundamental misunderstandings about Africa's potential role in the global minerals economy.
Four Critical Misconceptions About African Mining
Drawing from my experience bridging Swiss financial discipline with African market dynamics, I've identified four costly mistakes Western investors consistently make:
First, undervaluing Africa's role beyond extraction. Western investors often view Africa as a commodity source, not a strategic value chain player. This outdated view ignores how countries like Zimbabwe, Zambia, Tanzania, and Namibia are actively promoting value addition and local processing. These nations aren't just offering raw materials—they're establishing industrial parks, export processing zones, and renewable energy corridors to support midstream activities.
Second, overestimating political risk while underestimating strategic incentives. There's a persistent overgeneralization of political risk across the continent. While some regions pose challenges, others—such as Namibia, Botswana, Rwanda, and parts of Zambia and Tanzania—have clear mining codes, investment protection treaties, and improving infrastructure.
Ironically, many "low-risk" jurisdictions outside Africa are seeing increased resource nationalism and royalty instability. Africa often offers greater predictability when approached with long-term alignment, local partnerships, and development impact in mind.
Third, assuming infrastructure gaps are deal breakers. It's true that logistics, power, and refining infrastructure can be limited—but these challenges create high-value entry points. Swiss and European expertise in infrastructure finance, blended capital, and ESG integration can turn these gaps into platforms for strategic control. Capital deployed into mine-tied renewable power, green transport corridors, or battery precursor plants often generates far greater returns than isolated extraction projects.
Fourth, misjudging ESG potential and global supply chain relevance. Western investors sometimes view Africa as an ESG liability, when in fact it's a blank canvas for ESG innovation. Projects built from scratch with clean energy, community benefit-sharing, traceable sourcing, and biodiversity offsets can attract climate capital, EU-aligned supply contracts, and carbon credit revenue. Africa's critical minerals can serve not just as raw input but as "ethical minerals" for the energy transition—especially as Europe seeks to diversify away from China-dominated supply chains.
The Strategic Advantage of African Projects
The largest recent PE mining deal was a $64.7 million investment in a European green steel venture. But comparable or even greater investment opportunities exist in African critical minerals—with unique advantages unavailable in mature markets.
While European green steel projects focus on decarbonizing existing industrial processes, African critical mineral projects aim to establish entirely new value chains—from raw extraction to local processing and even battery precursor production.
A $60–100M investment in battery-grade lithium processing in Zimbabwe or Namibia, or rare earth separation in Tanzania, not only generates returns from mineral exports but positions investors at the heart of the global energy transition.
African projects offer four distinct advantages:
- First-mover advantage. Africa remains largely underexplored and undercapitalized, giving investors the opportunity to secure early equity stakes in world-class deposits and integrated infrastructure—something nearly impossible in saturated markets like Europe.
- Vertical integration opportunities. African projects often involve not just mining but co-investment in renewable energy, transport corridors, and downstream processing, offering multiple revenue streams and deeper control over supply chain dynamics.
- Access to ESG-linked incentives and climate finance. Greenfield projects in Africa can be designed from scratch to meet ESG criteria, attracting blended finance, development bank capital, and climate-linked funds not typically accessible to legacy industrial projects in mature markets.
- Strategic geopolitical positioning. As Europe and the U.S. push to reduce dependence on China for critical minerals, African nations are becoming preferred partners. Investors in African projects are well-placed to benefit from new trade deals, offtake agreements, and strategic reserves frameworks being advanced by the EU and other blocs.
One compelling case where our cross-cultural expertise unlocked hidden value was in a critical graphite project in southern Tanzania—a project initially dismissed by Western investment committees using conventional frameworks. Western evaluators flagged the project as too risky based on jurisdictional stereotypes about Tanzania, the site's lack of direct rail link or grid connection, and perceived permitting complexity. Under their frameworks, the project failed basic thresholds for capital allocation.
By bridging Swiss due diligence standards with local Tanzanian context, we shifted the analysis dramatically. First of all, through direct engagement with Tanzanian regulators and our team of legal advisors, we discovered that post-2019 reforms had actually introduced more predictable mining codes and streamlined permitting. The perceived volatility was more a misinterpretation of policy evolution, not instability. Secondly, instead of viewing the lack of grid power as a liability, we reframed it as an opportunity for co-located renewable energy development—specifically solar and storage solutions that could power the mine and be scaled to serve local communities. This opened doors to possible climate finance, increasing project bankability. Finally, through relationships with local chiefs, village councils, and national agencies, land access was secured via community development agreements that ensured shared revenue and local employment. This reduced social risk and enhanced project resilience, giving the investor a robust social license to operate.
The Integrated Investment Approach: Profit and Purpose
My experience building both gemstone businesses rooted in African craftsmanship and legal advisory services guiding international investment has taught me that the most enduring and successful mining investments are those that intentionally bridge profit and purpose. The idea that financial returns and meaningful economic transformation are mutually exclusive is a false dichotomy—especially in Africa, where resource investments sit at the intersection of economic sovereignty, community resilience, and global demand for sustainability.
Through our work in the gemstone sector, we've seen firsthand that true value isn't created at the point of extraction—it emerges through local value addition, storytelling, and market positioning. By investing in local cutting, certification, and jewelry design, we've turned what could have been a low-margin raw material into a globally marketable, high-margin product. This model creates jobs, builds pride in African craftsmanship, and enables premium pricing through traceability and ESG credentials. The same logic applies to critical minerals: the more of the value chain that remains in Africa, the more sustainable and profitable the investment becomes.
In our legal advisory work, we've supported foreign investors entering complex African jurisdictions. What we've learned is that legal compliance is just the baseline—true de-risking comes from alignment with national development priorities and community expectations. Investors who engage governments early, commit to local procurement, and co-develop infrastructure not only secure permits faster but also gain a long-term license to operate. These projects are more bankable, more politically resilient, and increasingly attractive to ESG-focused capital.
The future of mining in Africa belongs to those who design investments as vehicles for both value creation and value distribution. This means structuring projects where financial returns are tied to community uplift, skill development, and industrialization. It's not philanthropy—it's smart, forward-looking investment that reflects where global capital is headed.
Regional Opportunities in Critical Minerals
Africa is well-positioned to address global supply deficits in lithium, copper, and rare earths over the next decade.
For lithium, Zimbabwe has one of the largest hard-rock lithium deposits in Africa, while Namibia and the DRC also have emerging lithium assets suitable for battery-grade hydroxide production. These countries require processing incentives, clear licensing frameworks, and renewable energy integration to fully realize their potential.
For copper, Zambia and the DRC form one of the world's most copper-rich belts, critical for global electrification, EVs, and grid expansion. They need modernized mining codes, cross-border infrastructure development (particularly the Lobito Corridor rail project), and improved grid reliability to attract greater investment.
For rare earths, Tanzania's Ngualla project and Burundi's Gakara deposit contain high-grade rare earths critical for wind turbines, EV motors, and military applications. Angola also holds underexplored potential. These countries would benefit from special economic zones for rare earth processing, export-friendly regulation, and enhanced environmental safeguards and traceability systems.
The combined market value of key energy transition minerals – copper, lithium, nickel, cobalt, graphite, and rare earth elements – is projected to more than double to reach $770 billion by 2040 in a Net Zero Emissions scenario.
Countries that implement reforms early—such as Zambia, Namibia, and Tanzania—stand to become strategic supply chain hubs.
Private equity firms often find African mining investments complex due to perceived risks, regulatory ambiguity, and infrastructural challenges. Our approach to overcoming these barriers combines Swiss financial precision with deep African market understanding.
We often advise to adapt Swiss financial frameworks to African contexts by using tiered investment tranches linked to regulatory and operational milestones. This protects investors from front-loaded exposure while giving local partners clear incentives. In high-risk jurisdictions, we use hybrid capital models—blending equity with concessional finance or guarantees from DFIs—to make projects more bankable.
We embed multi-level stakeholder engagement from the outset—including local government, community leaders, and regulators. This ensures social license to operate and drastically reduces the likelihood of disputes or delays.
By building community development frameworks into the deal itself—such as equity shares, job guarantees, or infrastructure contributions—we align investor interests with national and local development goals, enhancing long-term stability.
Our legal advisory expertise enables us to navigate complex African legal systems and translate regulatory requirements into investor-friendly terms. We frequently negotiate stabilization clauses, investment protections, and tax certainty agreements, often using Swiss-style legal diligence and cross-border governance models.
This gives investors confidence in enforcement while helping African governments see the value in clear, investor-aligned legislation.
The Future of Private Equity in African Critical Minerals
By 2030, we expect the relationship between private equity and African critical minerals to evolve from cautious interest to strategic, long-term engagement. As mineral scarcity tightens and geopolitical tensions reshape global trade, Africa's role will shift from being a marginal supplier to a central player in the global critical minerals ecosystem. Private equity will increasingly view African projects not just as high-risk ventures, but as multi-dimensional investment platforms offering exposure to raw materials, energy infrastructure, and emerging industrial bases.
Zambia and the DRC will continue to dominate interest in copper and cobalt, especially if they expand into local smelting, battery precursor production, or grid-tied renewable energy. Zimbabwe and Namibia are emerging as key players in lithium, with Namibia's investor-friendly climate and push for midstream processing making it a favorite for ESG-conscious capital. Tanzania and Burundi, rich in rare earths and graphite, are likely to gain prominence, especially if they develop industrial zones or enter offtake agreements with Western or Asian manufacturers.
For African economies, this evolution could be transformational. Private equity will increasingly fund not only mines but also renewable energy plants, industrial parks, and technical training institutions, creating thousands of jobs and new industries. This will accelerate Africa's shift from a raw material exporter to a value-adding industrial continent, enhancing fiscal stability, economic sovereignty, and regional integration.
The critical minerals opportunity in Africa is not just about what's in the ground—it's about who controls the future of green industrialization. Western investors who see Africa merely as a risky bet miss the bigger picture: Africa is becoming a strategic node in global supply chains, with governments and partners eager to co-develop industries, not just extract resources.
Private equity has been struggling to fund mining projects in Africa, with only 2.8% of the estimated $17 billion in global mining-focused PE capital directed toward African projects, despite the continent's vast mineral resources. Those who bridge capital with impact—like Swiss institutions often do—will not only find superior returns but help build the foundations of a more diversified, resilient global economy.
Africa doesn't need extractors—it needs builders. And the most powerful mining investments are those that leave behind not just dividends, but ecosystems.
