The Critical Minerals Africa Group (CMAG) partnered with the Africa Finance Corporation to host a side-event at the Investing in African Mining Indaba in Cape Town. The event focused on investment opportunities in Africa’s critical minerals sector.
Chaired by CMAG’s Chief Strategy Officer, Olimpia Pilch, the event brought together stakeholders from the mining and finance sectors to discuss investment challenges and solutions. The discussions highlighted key concerns for investors and strategies to bridge funding gaps in the industry.
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Risk assessment in mining finance
Nyoko Isabela, Head of Mining Finance at Ecobank Transnational Incorporated, shared insights on how financial institutions assess risks in mining projects. She explained that banks examine technical feasibility, financial viability, regulatory compliance, and market conditions when evaluating mining investments.
“The broad strokes in scanning for risk that we perform as banks entail assessing technical soundness, financial and economic merits, compliance integrity, and market review. But even these are hardly enough to close the huge chasm between investor expectations that are strongly pitted in short-termism reflective of a world in flux, and the funding requirements that are needed for longer time-frames fraught with vacillating risk dynamics,” she said.
Isabela emphasised the need for stable policies to attract long-term investments. “What is needed in my view is a deliberate effort to realign expectations through clear-cut, consistent policies that encourage long-term investment.”
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Africa’s potential in the critical minerals sector
CMAG’s CEO, Veronica Bolton Smith, highlighted the potential of Africa’s critical minerals resources to drive economic growth. She noted that while the sector has the capacity to support industrialisation and economic transformation, securing adequate financing remains a challenge.
“There is an enormous amount of potential for Africa to leverage its critical minerals resources for both domestic industrialisation and broader economic transformation, but to do that, it needs adequate amounts of financing. Most mining projects are worth billions of dollars – finding the cash to finance such large projects is never going to be easy, particularly in a region which also has to deal with additional regulatory and geopolitical risks.”
Bolton Smith stressed the importance of structured industry discussions in shaping policy frameworks that facilitate investment. “CMAG’s conversations with policymakers and stakeholders at the Mining Indaba are an important part of our mission in coordinating industry expectations and interests and helping to formulate sound, long-term policy frameworks which can unlock the capital Africa needs to seize the full potential of its critical minerals.”
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Building investment confidence
The event underscored the need for strategies that address investor concerns and encourage financing for mining projects. Discussions focused on policy stability, transparent regulatory frameworks, and infrastructure development to support the sector’s growth.
CMAG continues to advocate for stronger collaboration between Africa and global markets to build resilient and diversified critical minerals supply chains. By fostering dialogue among industry players, the organisation aims to accelerate investment in Africa’s mining sector and create value for local communities.
