A European challenge

The need to secure access to CRMs
What are CRMs

Critical Raw Materials (CRMs) combine raw materials of high economic importance and of high-risks associated with their supply. Since the notion depends both on the availability of the substance and on its economic importance, it varies throughout the years. The European Commission has created a list of critical raw materials (CRMs) for the EU, which is subject to review and update every three years. The fourth list of CRMs is available here on the European Commission website. It was published in 2020 and includes 30 CRMs. 

AfricaMaVal focuses on the minerals and metals present in the fourth list of Critical Raw Materials for the EU as well as on Copper (Cu), Nickel (Ni), Tin (Sn) and Manganese (Mn) that are particularly pertinent considering Africa’s geological potential and their critical status in the digital and energy twin transitions. Thus, in the context of this project, we will speak about Extended Critical Raw Materials (ECRMs). 

Why are CRMs important?

Modern societies all around the globe are highly dependent on CRMs because they are essential in two main aspects:  

  • Maintaining growth and competitiveness. Indeed, raw materials can be both metals and chemical elements and are present in the technologies we constantly use, from the electronics of our dematerialized life to our means of transport and the lighting of our houses.  
  • Facilitating the environmental and digital “twin” transition. Indeed, the development of low carbon technologies to fulfil EU climate and energy objectives is dependent on the availability of raw materials.  

Why is the EU highly import-dependent when it comes to sourcing metals and what risks does it poses?

Due to the high level of natural concentration in particular regions of the globe, deposits of raw materials in the EU not easily accessible, already depleted after years of exploitation or not exploitable for technical or economic reasons, Europe is naturally highly dependent on foreign imports for minerals.

But in this context, geopolitical issues could heavily affect Europe’s supply, lead to price volatility, and impact market changes. As future demand of primary critical raw materials will continue to be largely met by importations, EU needs to diversify its supply chain and engage strategic partnerships with resources-rich third countries covering extraction, processing and refining such as African countries.

Therefore, securing reliable and unhindered access to certain raw materials is a growing concern within the EU.

It represents a critical issue for European ambition to deliver the Green Deal and perform the energy and digital twin transition. In this framework, AfricaMaVal project aims to develop EU-Africa partnership ensuring a responsible sourcing of mineral resources for the European industry while granting a sustainable local co-development in the best Environmental, Social and Governance (ESG) conditions and leading to a long-terms business environment for European and African companies.

AfricaMaVal's Solution

The development of sustainable EU-Africa partnerships

In a co-development perspective, AfricaMaVal project aims to develop an EU-Africa partnership ensuring a responsible sourcing of mineral resources for the European industry while granting a sustainable local co-development in the best Environmental, Social and Governance (ESG) conditions and leading to a long-terms business environment for European and African companies. 

Indeed, while the development of the African mining sector will expand the availability of ECRM for EU supply chains, the increased investment and financing can allow the EU to exert leverage on raw material supply chain conditions in order to improve their sustainability profile.

This will be achieved for instance by linking sustainability requirements in project financing with recent consumer-driven trends of Environmental, Social, and Governance (ESG) investment and enhancing the integration of ESG challenges into business models. Besides, an additional emphasis will be placed on integrating the artisanal and small-scale mining sector (ASSM), which is highly relevant for livelihoods and local development in Africa. 

How will AfricaMaVal successfully build such EU-Africa partnerships
and ensure sustainable raw materials value chain?

To build such partnership in a sustainable manner, the AfricaMaVal project relies on the 7 steps as detailed below. Due to the high relevance of the Artisanal and Small-Scale Mining sector (ASSM) for livelihoods and local development in Africa, a specific attention is being placed on integrating this sector along our different project’s steps. And additionally, a 8th step focusing on Communication and Dissemination is supporting the project’s implementation.

Learn more about each steps in details below: 

Creating a Pan-African dataset of ECRM supply potential.

Within this first step, our partners are working into integrating information on the Pan-African Extended Critical Raw Materials (ECRM) supply potential into one consistent dataset available for European political and industrial decision makers/stakeholders. This dataset will include available knowledge, exploration and mining projects, as well as existing processing and refining capacities. 

Analysing the Extended Critical Raw Materials value chain.

This second step of the project consist of the characterization and assessment of information on current ECRM value chains of both primary and secondary raw materials. The value chain items will be analysed and then sorted according to different characteristics such as project maturity degree, or level of beneficiation for specific CRMs. The analysis will also include the identification of potential bottlenecks and opportunities for growth of existing value chain segments, as well as projects with high economic potential or strategic interest. 

Identifying financial instruments.

The objectives of this step are to identify financial instruments and investment funds that may be available to development of RM projects in Africa at national, and/or international scale. The scope, coverage, and potential liquidity of these instruments will be defined, and their requirements and risk appetite will be specified. The objective is to determine liquidity sources for mining projects in the countries case studies. 

Analysing (ESG) conditions.

AfricaMaVal partners will contribute to improving the environmental and social sustainability of the minerals value chains in Africa, and to eradicate illegal and ethically doubtful practices, by informing the assessment of investment opportunities with Environmental Social and Governance (ESG) country data. A survey to assess specific ESG challenges across Africa will be carried out.

This way, the project will facilitate sustainable investment on a “do no significant harm principle” and enable the development of sustainable and responsible strategic partnerships for EU-Africa industrial value chain integration.  

Building an EU-Africa business network.

AfricaMaVal also aims at building an EU-Africa business network with upstream and downstream companies and steering the development of strategic partnerships and business models for EU-Africa industrial value chains integration.

It will allow connecting different stakeholders of raw materials value chains, including final users and strengthening the local governance and responsible business environments, together with other institutions and development partners (EITI, OECD, UNDP, WB, and Germany’s GIZ).

Developing a strategy for the integration of existing and emerging EU and African raw Materials value chains for the energy & digital transition.

Step 6 builds on the benchmarking activities carried out in steps 1, 2, 4, 5, and 7, analysing past and ongoing European and African project’s key challenges, inputs and potential synergies with AfricaMaVal. Envisioning thus the impacts of the targeted investments and tailored activities, step 6 partners will define a strategy for the integration of existing and emerging EU and Africa raw materials value chains for the energy and digital transition.

Identifying responsible investment opportunities.

The purpose of this step is to map and assess responsible investment opportunities in ECRM value chains in Africa (exploration, mining and refining projects). Thus, the investment analysis shall consider raw material potential, strategic relevance, economic feasibility, availability of infrastructure, good governance, ESG parameters and regulatory issues, and link up with the EU Green Deal and sustainable finance framework. 

What will be the results of the AfricaMaVal project?

AfricaMaVal will evaluate 100 ECRM value chains investment opportunities in Africa.

The main project’s tangible result will be a list of 100 evaluated opportunities of responsible investments in the ECRM value chains in Africa.  It is expected that between 30 and 50% of these opportunities could be converted into concrete projects of EU-African partnerships.

This would lead to a significant increase of European mining projects in Africa and thus would contribute to securing EU sustainable access to primary and secondary raw materials from Africa.