An increase in local value creation and global support needed. Possible investment gap of up to $270 billion.
Global investment in raw materials for the energy transition cannot keep pace with the rapidly growing demand – this is the conclusion reached by the United Nations Conference on Trade and Development (UNCTAD) in a new report. It has identified 110 new mining projects worth 39 billion US dollars; however, to achieve the net-zero emissions targets for 2030, around 80 new copper mines alone, 70 additional ones each for lithium and nickel and 30 for cobalt would be necessary. This could result in an investment gap of 180 to 270 billion dollars between 2022 and 2030.
UNCTAD writes that this offers both opportunities and risks for mineral-rich developing countries, particularly in Africa. It could be particularly challenging for those who are heavily dependent on the export of raw materials. To diversify their economies, fully exploit their own mineral wealth, and benefit from rising demand, developing countries would have to go beyond the supply of raw materials and increase local value creation. Some countries, such as Namibia, have already imposed export bans on unprocessed raw materials.
UNCTAD also points to the need for global support: more sustainable and transparent mining contracts and exploration licenses are needed to strengthen the regional industry. The United Nations also sees itself as having a duty in this regard. As we reported, the organization has recently set up a committee comprising the governments of almost 100 industrialized and developing countries to deal with environmental and social issues relating to the extraction of raw materials.
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