OPINION | SA must champion regional co-operation to unlock the full potential of its critical mineral reserves

SA stands at a defining moment in its economic history. As the global appetite for critical minerals accelerates – driven by the green energy revolution and the rapid adoption of low-carbon technologies – the country faces a rare opportunity to reassert itself as a major force in the international supply chain.

With vast mineral wealth, SA has the potential to not only strengthen its economy but to become an indispensable player in the world’s transition to clean energy. To capitalise, the country must address structural weaknesses, invest in infrastructure and take bold steps to ensure the sector’s long-term sustainability.

SA boasts an unmatched endowment of critical minerals – housing 90% of the world’s platinum reserves and a dominant share of global manganese production. These resources are crucial for electric vehicle (EV) batteries, hydrogen fuel cells and renewable energy storage. However, SA’s mining sector has seen its GDP contribution steadily decline, a trend worsened by logistical inefficiencies, unreliable energy supply and the ongoing struggles of Transnet. Unless these systemic issues are resolved, the nation risks losing out on a once-in-a-generation economic opportunity.

SA is not alone in the critical minerals race. The Democratic Republic of Congo (DRC), the world’s leading cobalt producer, offers a cautionary tale of both immense potential and instability. The DRC supplies 70% of global cobalt, a metal essential for high-performance EV batteries, yet much of this output is processed in China, limiting the economic benefits retained within Africa.

The urgency to secure stable sources of critical minerals has never been greater. In 2023, one in five cars sold globally was electric, a figure projected to rise sharply in the coming years. China, which dominates battery manufacturing and refining, has positioned itself as the primary beneficiary of Africa’s raw materials, while Western nations scramble to diversify their supply chains.

For SA, the stakes are clear: either become a key refining and processing hub or remain a mere exporter of raw materials with limited value addition. The country must urgently resolve its supply chain constraints to capitalise on its vast mineral wealth. Transnet has become a critical bottleneck, with inefficiencies costing the mining sector billions in lost revenue. In 2022 alone, rail disruptions forced mining companies to shift bulk commodities like coal and manganese onto roads – an expensive and unsustainable alternative.

Equally pressing is the need to expand local refining capacity. Now, much of SA’s critical minerals are exported in raw form, with little domestic beneficiation. By investing in processing facilities and forging partnerships with global technology firms, the country could capture more value within its borders – stimulating job creation, industrial growth and long-term economic resilience.

In 2024, SA’s mineral exports totalled R780.7bn, down from more than R800bn the previous year. The decline is largely attributable to Transnet’s rail and port inefficiencies. The company remains the backbone of mineral exports, with more than 90% of SA’s seaborne coal shipments passing through Richards Bay, including the Richards Bay Coal Terminal.

SA’s mineral ambitions cannot be pursued in isolation. The broader African landscape presents both opportunities and risks. While the continent holds a share of the world’s copper, cobalt and lithium reserves, many of these resources are concentrated in politically volatile regions. Instability in the DRC threatens to disrupt supply chains, while limited regional co-ordination hampers Africa’s ability to negotiate from a position of strength in global markets.

To unlock the full potential of its critical minerals, SA must champion regional co-operation. This means taking a leading role in stabilising conflict-prone areas, fostering cross-border trade agreements and facilitating investment in shared infrastructure. The African Continental Free Trade Area offers a framework for such collaboration, but practical implementation has been slow.

SA’s mineral wealth extends beyond its export value – it represents a potential catalyst for broader economic transformation. The mining sector remains a major employer, supporting more than 400,000 jobs and contributing substantially to tax revenues. But to ensure sustainable growth, SA must move beyond extraction and invest in the downstream industries that will define the future of clean energy.

Despite its vast mineral wealth, SA faces a paradox: it exports critical minerals essential for green technologies but lags in adopting these technologies domestically. Local demand for EVs, solar panels and battery storage remains low, largely due to affordability constraints and a lack of supportive policy frameworks. If SA truly seeks to position itself as a global leader in the clean energy revolution, it must not only export raw materials but also drive domestic innovation and adoption.

The world is entering an era where control over critical minerals will define economic power. For SA, the choice is stark: embrace this opportunity with urgency and strategic foresight or risk being sidelined in the new global economy.

• Mabasa is an executive manager in the office of the deputy minister of mineral and petroleum resources and co-chairperson of SA’s Brics Youth Council