Let’s discuss resource ownership vs. processing power.
Countries that only export their critical minerals in raw form risk becoming the biggest losers of the 21st century. The real economic advantage lies not in ownership, but in the ability to process and add value.
A key dynamic in this space is the separation between resource ownership and processing power.
While some countries process these minerals and use them in modern high-technology manufacturing, others remain stuck as mere suppliers in raw form.
For instance, China stands as the world’s largest processor of rare earth elements, controlling a significant share of global processing capacity, not because it has the largest deposits, but because it has invested heavily in refining and industrial capacity.
On the other hand, several countries are richly endowed but lack the technical skills, infrastructure, and technologies to transform them into high-tech equipment.
Examples include:
- The Democratic Republic of Congo (DRC) accounts for about 70% of the world’s cobalt supply and holds its largest deposits.
- Australia: A major supplier of raw iron ore, coal, and lithium spodumene (hard rock)
- The Philippines: A major exporter of raw nickel ores and concentrates.
This imbalance means value is often captured outside resource-rich countries.
IMPLICATIONS FOR DEVELOPING ECONOMIES
For developing countries, especially in Africa, it is important to move beyond selling minerals in raw form. This often become a curse rather than blessing if not processed locally.
Processing creates:
▪️ Industrialization – more factories and production
▪️ Higher export earnings – value-added products
▪️ Economic diversification – reduced dependence on oil
Our failure to align with value addition has cost us:
🔹 Remaining raw exporters
🔹 Missing value addition
🔹 Dependency in global supply chains
🔹 Loss of forex earnings
🔹 Exporting jobs
THE WAY FORWARD
➤ Strategic partnerships for technology transfer
➤ Investment in local processing and refining
➤ Development of technical and industrial capacity
➤ Strong institutions and governance
➤ Focus on value chains, not just extraction
➤ Education aligned with industrial needs
FINAL THOUGHT
Ownership of resources is no longer enough.
The real advantage lies in processing power, value addition, and the ability to compete globally.
Beyond raw policy, what do you believe is the single biggest bottleneck preventing local industries from processing critical minerals: infrastructure, technical skills, or capital? Let’s discuss.
Akinsulere’s Economic Notes.
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