Sub-Saharan Africa: risks and opportunities for diversifying the EU’s critical raw materials supply chain

Mounting geopolitical tensions in recent years have accentuated the dangers of overly relying on a single supplier for materials critical to a country’s economy and energy security. Russia’s invasion of Ukraine highlighted the EU’s dependence on Russian gas and enriched uranium. Meanwhile, China’s ban in 2023 on the export of rare earth extraction and separation technologies, and the production of rare earth magnets, emphasized its dominance in this sector. China accounts for approximately 60% of global rare earth extraction and nearly 90% of processing capacity.

The competition for access to critical materials is intensifying, with export controls becoming a frequent instrument in geo-political power struggles. In December 2024, China imposed a ban on exports to the US of antimony, gallium, germanium and superhard materials. This action was a direct response to the US government’s expanded restrictions on advanced equipment and technology used for the manufacturing of semiconductors and AI memory chips. The Washington DC’s tariffs hikes prompted Beijing to impose in February 2025 tightened export controls on five additional critical materials (tungsten, tellurium, bismuth, indium and molybdenum) that are used in the clean energy, defense, electronics and manufacturing industries. As a result of these restrictions, between January and March 2025, bismuth prices surged more than six-fold on the European spot market and eight-fold in the US, underscoring China’s dominance in the global bismuth supply chain. The Asian country accounts for over 80% of worldwide production.

To secure access to critical raw materials, major economies, including the EU and the US, have developed lists of such materials and devised strategies to mitigate supply chain vulnerabilities. In 2023, the EU identified 34 critical raw materials, including three groups: heavy rare earth elements (HREE), light rare earth elements (LREE) and platinum- group metals (PGM) (see Table below). Despite not meeting the specific thresholds for economic importance and supply risk, copper and nickel were also included due to their strategic significance.

For more than half of these critical raw materials, the EU relies on a single third country for over 50% of its supply. Moreover, for more than one third of all critical raw materials, that single third-party supplier is China. The supply chain concentration is particularly pronounced for materials like boron, lithium, magnesium and most rare earth elements, where the EU sources over 75% from a single supplier, predominantly China. To reduce its dependence on single third-party suppliers, the EU has introduced the Critical Raw Materials Act (CRMA), aiming to bolster domestic capacities and diversify external partnerships. By 2030, the CRMA sets ambitious targets for the EU to domestically extract at least 10%, process at least 40% and recycle at least 25% of its annual consumption of strategic raw materials. Additionally, the Act stipulates that no more than 65% of any strategic raw material, at any stage of processing, should be sourced from a single third-party supplier, thereby reducing the risk of supply chain disruptions.

Sub-Saharan Africa’s vast mineral resources present opportunities for diversifying the EU’s critical raw materials supply chain. Several African countries are already important raw materials suppliers, such as DR Congo for cobalt, Guinea for bauxite and South Africa for platinum group metals. However, the EU’s supply chain network can expand beyond these core suppliers and raw materials (see Table). Over the past few years, the EU has signed memoranda of understanding with Namibia, Zambia, DR Congo and Rwanda for access to these resources.

However, each African country presents a unique set of risks that the EU and investors must carefully consider before formalizing agreements and committing to investments. These risks include political instability, economic volatility, regulatory changes, and issues related to transparency and corruption. For instance, in February 2025, the European Parliament urged the suspension of the memorandum of understanding with Rwanda due to its support for M23 rebels in eastern DR Congo. The M23’s territorial expansion has resulted in tantalum and tin supply disruptions, driving up prices for these commodities. Due to the conflict, sourcing minerals from DR Congo and Rwanda also poses significant reputational and legal risks.

While no destination is risk-free, the nature and severity of risks vary across sub- Saharan Africa. Countries like DR Congo, Mali, Mozambique and Zimbabwe present challenging business environments due to a combination of security concerns, political instability and economic issues. Conversely, Côte d’Ivoire, Ghana, Namibia and Zambia, despite some challenges, offer more stable and favorable business climates. Below we discuss some of the risks encountered in various sub-Saharan African countries.

1. Security risks such as terrorist attacks and/or military coups are heightened in Burkina Faso, DR Congo, Gabon, Guinea, Mali, Mozambique, Nigeria and Togo. DR Congo, Mali, Mozambique, Nigeria and Togo face elevated security risks from attacks by rebel and Islamist groups, though these threats are generally localized. In Burkina Faso, Mali, Guinea and Gabon investors must navigate populist military governments with minimal checks on their power. Historical evidence suggests that countries experiencing military coups are more susceptible to subsequent coups. In Burkina Faso and Mali, military governments have strained relations with Western nations, favoring instead ties with Russia and China.

2. Political suppression undermines stability in Burundi, Rwanda, Uganda, Tanzania, Togo and Zimbabwe. Authoritarian leaders in Burundi, Rwanda, Uganda, Togo and Zimbabwe severely restrict political freedoms, raising the risk of sudden political upheavals, especially concerning long-standing leaders. While the business environment in Tanzania improved under President Samia Suluhu Hassan, there are growing concerns about increased state suppression as the October 2025 presidential elections approach.

3. Efforts by leaders in Côte d’Ivoire, Madagascar and Senegal to extend their time in power have eroded their political legitimacy and destabilized their respective countries. In Côte d’Ivoire, President Alassane Ouattara’s decision to seek a third term in 2020, despite controversy over term limits, sparked violent protests. Ouattara is expected to run again in October 2025. Similarly, in Madagascar, President Andry Rajoelina’s re-election in 2023 was marred by opposition boycotts and allegations of irregularities, resulting in the lowest turnout in the nation’s history. In Senegal, former president Macky Sall’s attempt to prolong his tenure triggered political unrest, which was resolved with the election of opposition candidate Bassirou Faye in 2024.

4. Economic challenges related to public debt, weak domestic currency and high living costs has undermined business environments in Ghana, Kenya, Nigeria, South Africa and Zambia. Ghana and Zambia defaulted in 2022 and 2020 respectively and have grappled with a painful and protracted debt restructuring. Unpopular state reforms to address economic hardship have resulted in widespread protests against the governments of President Bola Tinubu in Nigeria and President William Ruto in Kenya. In the 2024 general election, South Africa’s ruling African National Congress (ANC) party lost its parliamentary majority for the first time since the end of apartheid in 1994, forcing it to form a fragile coalition. The poor electoral result was attributed to the ANC’s inability to tackle widespread poverty and corruption, high inequality and unemployment rates, and recurrent water and power shortages.

5. Resource nationalism risks have intensified across sub-Saharan Africa as countries seek to extract greater value from their mineral resources. In 2023, Mali’s military junta adopted a new mining code to strengthen government control over mining projects, increase state and indigenous participation, and impose more stringent local content requirements. In the same year, Zimbabwe and Namibia banned the export of unprocessed minerals, aiming to retain more value domestically. Zambia and Ghana have proposed legislation on critical minerals to enhance state participation in new mining projects and restrict the export of unprocessed critical minerals. In summary, while sub-Saharan Africa offers significant opportunities for diversifying the EU’s critical raw materials supply, careful assessment of each country’s specific risks is essential to mitigate potential losses and reputational damage. For a concise analysis of a country’s risk landscape and risk trends contact us at info@bovcon.com.

Table: Key suppliers of the EU’s critical raw materials (CRM), African countries with known CRM reserves and key CRM uses:

*Data referring to the share of imports in 2023 quoted in Eurostat, otherwise data refer to the share of supply between 2016-2020 quoted in EC: Study on the Critical Raw Materials for the EU 2023 - Final Report. Sources: European Commission (EC): Eurostat; EC: Raw Materials Information System; EC: Study on the Critical Raw Materials for the EU 2023 - Final Report; African Green Minerals