The world’s most powerful economies are racing to secure the minerals of the future. Africa is once again at the center of that competition.

In Washington, policymakers are searching for alternatives to China’s dominance over critical mineral supply chains. European governments are pursuing new partnerships to secure materials essential to their industries. Beijing, having spent decades investing in mining, processing and infrastructure, remains deeply embedded in the global mineral economy.

At the center of this competition sits a continent with some of the world’s most strategically important natural resources.

The Democratic Republic of the Congo supplies much of the world’s cobalt. Zambia is a major copper producer. Zimbabwe has significant lithium resources. Mozambique is emerging as an important source of graphite. Across the continent, deposits of manganese, platinum group metals and rare earth elements are attracting growing international attention.

These minerals are essential to electric vehicles, electricity networks, artificial intelligence infrastructure, advanced manufacturing and modern defense technologies.

For the world’s industrial powers, securing access to them has become a matter of economic and national security.

For Africa, however, the stakes are considerably greater.

The continent is not simply negotiating over the future of global supply chains. It is negotiating over its own economic future.

And the most important question is not how much the world is willing to pay for Africa’s minerals.

It is whether Africa can finally turn its natural wealth into lasting economic power.

The return of resource diplomacy

The global competition for critical minerals is accelerating.

On October 9, Reuters reported that the U.S. International Development Finance Corporation plans to expand its direct equity investments, including in African critical minerals projects.

The agency has more than $14 billion in investment commitments across Africa, with over $3 billion associated with critical minerals and related projects.

The announcement reflects a broader shift in American economic policy.

Access to strategic minerals is no longer viewed primarily as a commercial matter. It is increasingly understood as a national security concern, particularly as Washington seeks to reduce vulnerabilities associated with concentrated supply chains.

China’s position explains much of this urgency.

Through decades of investment in mining, processing, refining and industrial manufacturing, China has established a commanding position in several critical mineral supply chains.

The International Energy Agency’s 2026 Global Critical Minerals Outlook warns that the concentration of mineral processing and the expansion of export restrictions are creating significant risks for the global economy.

For the United States and its allies, diversifying supply chains has become an urgent strategic priority.

Africa offers part of the answer.

But for African governments, the renewed international interest raises an uncomfortable question.

Will this competition create a different economic relationship, or will it reproduce the familiar arrangement in which Africa exports raw materials while other countries capture the greater share of industrial value?

The economic contradiction at the heart of Africa’s mineral wealth

Africa’s resource wealth is substantial.

The African Development Bank estimates that the continent holds approximately 30 percent of the world’s deposits of key critical minerals.

Yet Africa’s position in global manufacturing remains far smaller than its importance in mineral production would suggest.

This imbalance reflects a longstanding structural problem.

Many African economies participate in international supply chains primarily through extraction and the export of raw or minimally processed commodities.

The more technologically advanced and profitable stages of production, including refining, component manufacturing and finished products, are often concentrated elsewhere.

Consider the journey of a mineral used in an electric vehicle battery.

It may be extracted in an African country, shipped abroad for processing, incorporated into a battery component in another market and ultimately become part of a vehicle manufactured thousands of miles from the original mine.

At each stage, additional economic value is created.

The country where the mineral originated may receive export earnings, tax revenue and some employment benefits. But much of the industrial activity, technological expertise and manufacturing employment develops outside its borders.

This arrangement is not unique to Africa, nor is every stage of manufacturing necessarily profitable.

But it illustrates a central challenge.

For African countries seeking economic transformation, that distinction is becoming increasingly important.

A new industrial ambition is emerging

African policymakers are increasingly challenging the assumption that mineral extraction alone should define the continent’s participation in the global economy.

In July 2026, African ministers and development partners gathered in Abidjan for a forum organized by the African Development Bank on critical minerals, industrial development and value creation.

The message was clear: Africa must capture more value from its natural resources through domestic processing, regional industrial cooperation and stronger manufacturing capabilities.

This represents an important evolution in the continent’s development ambitions.

Rather than viewing mineral exports as an end in themselves, governments are increasingly examining how natural resources can support broader economic transformation.

But ambition must be matched by economic reality.

Building a competitive mineral processing industry requires reliable electricity, affordable financing, modern transportation networks, skilled workers and access to international markets.

These are precisely the areas where many African economies face significant constraints.

A refinery cannot operate competitively without dependable power.

A manufacturing facility cannot succeed if transportation costs make its products uncompetitive.

And a government cannot create a sustainable industry simply by requiring companies to process minerals locally.

Industrialization requires investment, institutions and long term planning.

It also requires a clear understanding of which industries can realistically compete in domestic, regional and international markets.

The objective should not be to process every mineral within the country where it is extracted.

It should be to identify opportunities where African economies can capture greater value competitively and sustainably.

Regional cooperation may prove essential.

Under the African Continental Free Trade Area, countries have an opportunity to connect mineral production, transportation, processing and manufacturing across national borders.

A mineral extracted in one country could support industrial activity in another, creating economic opportunities across an integrated regional supply chain.

Such an approach could allow African economies to develop industries that would be difficult to sustain within individual national markets.

The missing measure of success

Much of the international discussion surrounding critical minerals focuses on investment figures.

Governments announce billion dollar agreements. Development institutions promote financing commitments. Mining companies publicize new discoveries and production targets.

These announcements attract attention because they suggest economic momentum.

But investment commitments alone provide an incomplete picture of development.

A mining project can generate substantial export revenue without creating broad employment opportunities.

A transportation corridor can improve access to international markets while doing relatively little to support domestic businesses if local economic linkages are weak.

A processing facility can increase export value without delivering meaningful benefits to nearby communities if its operations remain disconnected from the wider economy.

For Tiir Institute, this raises a fundamental policy question: what should count as success in Africa’s critical minerals economy?

The answer must extend beyond mineral output, export earnings and foreign investment.

It should include the development of local industries, the participation of domestic businesses, the expansion of technical skills and the creation of productive employment.

These outcomes are particularly important given Africa’s demographic future.

The continent’s rapidly growing working age population will require an extraordinary expansion of economic opportunities in the coming decades.

Mining, particularly highly mechanized operations, cannot independently meet that demand.

Its broader economic potential lies in the industries and services connected to mineral production.

Engineering, construction, logistics, equipment maintenance, industrial technology, environmental management and manufacturing can create opportunities for workers and businesses across different sectors.

But these benefits are not automatic.

They depend on deliberate efforts to connect major investments with local economic development.

Workforce training institutions must understand the skills employers will need.

Domestic businesses must have opportunities to compete for contracts.

Infrastructure should be designed to serve surrounding economies where commercially and financially feasible.

And governments must establish policies that encourage investment while ensuring that public revenues are managed responsibly.

Without these connections, Africa risks experiencing another period of resource expansion without achieving the broader economic transformation its populations need.

What Washington should understand

For the United States, Africa’s critical minerals present both a strategic necessity and an economic opportunity.

American policymakers have legitimate reasons to seek more secure supply chains.

The concentration of mineral processing in China creates vulnerabilities for industries ranging from advanced manufacturing to defense technology.

Diversification could strengthen American economic resilience.

But securing access to African minerals is only one part of building durable international partnerships.

The United States must also consider what African countries expect from those relationships.

Across the continent, governments are seeking industrial investment, infrastructure, technology, employment and opportunities for greater participation in international markets.

These ambitions should not be treated as secondary to American supply chain priorities.

They should be incorporated into the design of economic partnerships.

American development finance institutions, private investors, universities and industrial companies could help support commercially viable projects that combine mineral development with broader economic opportunities.

Such cooperation could include technical education, industrial infrastructure, processing facilities and stronger participation by local suppliers.

It would also require realistic assessments of financial risks, governance conditions and commercial feasibility.

Not every project will succeed.

But partnerships that create value for both sides are more likely to endure than arrangements focused narrowly on resource access.

This is where American economic diplomacy has an opportunity to distinguish itself.

Rather than treating Africa primarily as an alternative source of strategic materials, Washington could approach the continent as a potential industrial and commercial partner.

The difference is significant.

One approach seeks access to resources.

The other seeks to build economic relationships capable of supporting shared prosperity.

Africa must also confront its own challenges

International competition alone will not transform Africa’s economic future.

African governments have responsibilities that cannot be transferred to foreign investors or development partners.

Weak institutions, unpredictable regulations, corruption, inadequate infrastructure and inconsistent industrial policies can undermine even the most promising economic opportunities.

Resource nationalism can also create unintended consequences.

Policies intended to increase domestic value creation may discourage investment if they are introduced without adequate infrastructure, commercial planning or regulatory certainty.

Likewise, generous concessions offered to attract foreign companies can weaken public benefits if agreements are poorly negotiated or inadequately enforced.

The challenge is to establish a credible balance.

African countries need regulatory systems that protect public interests while allowing businesses to operate competitively.

They need transparent licensing arrangements, responsible environmental oversight and effective management of mineral revenues.

They also need to invest in the foundations of industrial development.

Electricity, transportation, education, technical training and institutional capacity are not secondary concerns.

They are the infrastructure upon which successful economic transformation depends.

Without them, mineral wealth may generate revenue without producing the diversified economies that African governments seek.

A defining moment for Africa’s economic future

The international race for critical minerals is likely to remain a major feature of global economic competition.

Demand for copper, lithium, graphite and other strategic materials will continue to influence investment decisions, trade relationships and industrial policy.

Africa’s importance in these markets gives the continent an opportunity to negotiate new economic partnerships and strengthen its position in global commerce.

But the opportunity should not be confused with an inevitable transformation.

Natural resources have never been a guarantee of prosperity.

Some resource rich economies have built strong institutions and diversified industries. Others have remained dependent on commodity exports, vulnerable to price fluctuations and unable to generate sufficient employment.

Africa’s future will depend on which path its governments and businesses choose.

The most successful countries will not necessarily be those with the largest mineral deposits.

They may be those that develop the strongest institutions, the most competitive industries and the most effective strategies for connecting investment with economic opportunity.

For international partners, the lesson is equally important.

Africa’s economic ambitions cannot be separated from the global competition for its resources.

Governments seeking reliable mineral supplies must recognize that African countries are pursuing their own long term development objectives.

A durable partnership must account for both.

The world is entering an era in which critical minerals will help determine economic competitiveness, technological leadership and national security.

Africa has an important role to play in that future.

But the continent’s ambition should extend beyond becoming an indispensable supplier to the world’s industrial powers.

It should become a place where more of the industries, technologies and economic opportunities associated with those resources are developed.

That is the challenge that will determine whether today’s global mineral competition becomes another chapter in Africa’s history of resource extraction or the beginning of a more transformative economic future.

The electricity story of the Horn of Africa is often told too simply. The region is described as dark, disconnected, and waiting to be rescued by the next large power project.

That picture is incomplete.

The Horn contains several different energy realities. Ethiopia has greatly expanded electricity access and already trades power with neighboring countries. Djibouti has been connected to Ethiopia's electricity system since 2011. Kenya and Ethiopia are linked through a major transmission line. Somalia and Somaliland have electricity markets built largely by private providers, with solar increasingly combined with diesel generation. Across the wider region, mini grids and household solar systems serve communities that national grids have not reached.

The challenge is therefore not simply to produce electricity where none exists. It is to make power more affordable, more reliable, more widely available, and more useful to the productive economy.

That distinction matters. Electricity policy should not be judged only by the number of homes connected or the size of a new power plant. It should also be judged by whether electricity helps a farmer irrigate land, a clinic store medicine, a fishing company operate cold storage, a workshop purchase better machinery, or a factory compete with imported products.

The Horn does not have one electricity problem. It has several related problems, and each requires a different solution.

Progress Is Real, but Uneven

Ethiopia illustrates both the progress and the unfinished work. According to the country's National Energy Compact, a 2025 survey found that 65 percent of Ethiopian households had some form of electricity access. The country has also developed substantial hydropower capacity and participates in cross border electricity trade.

Djibouti has imported electricity from Ethiopia through an interconnector operating since 2011. Ethiopia is also connected to Kenya through a high voltage transmission link. These connections show that regional power cooperation is not merely an idea for the future. It already exists.

The Eastern Africa Power Pool brings together countries working toward a more integrated regional electricity market. Somalia has joined the organization, while Djibouti, Ethiopia, Kenya, and Sudan are among its members. In June 2026, the World Bank approved a 1.6 billion dollar regional program intended to expand electricity trade, strengthen transmission, and improve the reliability and affordability of power across Eastern Africa.

These are significant developments. Any serious analysis should recognize them.

But regional progress remains uneven. A country may generate large amounts of electricity while many households remain unconnected. A city may have electricity throughout the day while businesses still pay prices that make manufacturing difficult. A rural community may receive a solar connection that is sufficient for lighting and charging a telephone but not for operating agricultural machinery or refrigeration.

Access, affordability, reliability, and productive capacity are different measurements. Governments should stop treating them as though they are the same.

Somalia and Somaliland Present a Different Model

The electricity systems in Somalia and Somaliland developed under conditions very different from those of neighboring countries. With limited public infrastructure and weak central institutions, private companies built local generation and distribution networks, often relying on diesel and later adding solar power.

That private sector role deserves recognition. In many cities, businesses supplied electricity when public institutions could not. They invested capital, connected customers, collected payments, and kept local systems operating under difficult circumstances.

But the model also produced fragmentation. Separate providers built their own generation and distribution systems. Diesel dependence exposed prices to international fuel costs. Small markets limited economies of scale. In some locations, technical losses and duplicated infrastructure increased costs.

A World Bank assessment of Somalia's electricity sector, published in 2021, reported high tariffs, fragmented private systems, and substantial technical losses. Since then, investment in solar generation, hybrid systems, regulation, and network improvements has continued. It would therefore be inaccurate to use the older figures as though nothing has changed.

The more current and defensible conclusion is narrower: electricity costs remain a significant constraint on businesses, and the sector still needs greater scale, investment, interconnection, and transparent regulation. The World Bank's 2026 Somalia Economic Update identifies limited access, unreliable supply in some areas, and high electricity costs as barriers to private sector growth and job creation.

The policy goal should not be to push private providers aside. It should be to help successful providers modernize, integrate renewable energy, connect systems where practical, improve efficiency, and operate under rules that protect both investors and consumers.

The Central Economic Question Is Cost

For businesses, electricity is an input like labor, rent, transportation, or financing. When power is expensive, the price appears throughout the economy.

A bakery pays more to operate its equipment. A water company pays more to pump and distribute water. A clinic pays more to refrigerate medicine. A fishing business pays more to make ice and preserve its catch. A hotel pays more to cool rooms. A workshop pays more to operate machinery.

Those costs eventually reach consumers.

High electricity prices also influence what kinds of businesses are created. Trading imported goods may appear safer than manufacturing local products. A company may remain small because expansion would require machinery it cannot afford to operate. An investor may choose a neighboring market where electricity is cheaper and more predictable.

This does not mean that every electricity provider is charging an unreasonable price. In systems dependent on imported diesel, with small customer bases and limited transmission infrastructure, the underlying cost of producing electricity can genuinely be high.

That is why price controls alone will not solve the problem. Governments cannot order electricity to become cheaper while ignoring fuel costs, technical losses, financing, maintenance, and the size of the market.

Renewable Energy Is an Economic Opportunity

The Horn has strong renewable energy resources, but potential should not be confused with production.

Solar panels do not become an electricity system by themselves. Wind resources do not automatically become bankable power projects. Hydropower generation does not guarantee household access. Every energy source requires transmission, distribution, financing, maintenance, technical skills, and capable institutions.

Still, renewable energy offers the region a practical opportunity to reduce dependence on imported fuel and serve communities beyond national grids.

Solar generation is particularly important for Somalia, Somaliland, Djibouti, and other areas with strong sunlight and expensive diesel based generation. Battery storage can help solar systems provide electricity beyond daylight hours. Mini grids can serve smaller towns and rural communities where extending a national grid would be too expensive.

The World Bank has concluded that solar mini grids can provide uninterrupted renewable electricity to underserved communities and may be the least expensive option for many locations in Sub Saharan Africa.

But mini grids are not automatically affordable. Financing costs, imported equipment, taxes, limited demand, and unclear regulation can make electricity expensive. Governments and development partners should therefore focus on reducing the cost of capital, establishing predictable rules, supporting storage, and helping providers expand their customer base.

The objective should be a functioning market, not simply the installation of equipment.

Regional Trade Is Already Part of the Solution

The Horn does not need to invent regional electricity cooperation from the beginning. It needs to expand and improve what already exists.

Ethiopia's connections with Djibouti and Kenya demonstrate the basic economic logic. Countries with available generation can earn revenue through exports. Importing countries can reduce their dependence on more expensive generation. Larger connected markets can attract investment that would not be practical within a small national system.

The next stage should include stronger domestic transmission networks, clearer rules for power purchases, better coordination between utilities, and greater operational capacity within the Eastern Africa Power Pool.

Regional trade will not eliminate the need for domestic investment. Electricity arriving at a national border is useful only if the domestic grid can deliver it to homes and businesses. Transmission and distribution therefore matter as much as generation.

Somalia's membership in the regional power pool creates a long term opportunity, but membership alone does not produce an interconnector. Technical studies, financing, domestic networks, security, and agreements with neighboring systems would all be required before significant cross border trade becomes possible.

Leaders should present regional integration honestly. It is a long term infrastructure project, not an immediate solution. But it is an opportunity worth pursuing.

Electricity Must Be Connected to Jobs

The strongest energy strategy begins with a simple question: what economic activity should this electricity make possible?

Agricultural areas need electricity for irrigation, water pumping, refrigeration, milling, and food processing. Coastal economies need ice production, cold storage, and fish processing. Livestock regions can use power for meat processing, leather production, veterinary services, and animal feed. Cities need electricity for construction materials, health care, digital services, workshops, and manufacturing.

Energy planners should work directly with business associations, local governments, farmers, universities, and workforce institutions. A new mini grid serving a town should be designed around expected commercial demand, not only household lighting. An industrial zone should have a credible power plan before investors are invited. Training programs should prepare local electricians, solar technicians, engineers, and maintenance workers for the projects being financed.

This is how electricity creates employment twice. It creates jobs inside the energy sector and enables jobs across the rest of the economy.

A More Accurate Agenda for Leaders

The Horn's leaders do not need another declaration claiming that electricity is important. They need policies suited to the different realities of their markets.

Where national grids exist, governments should strengthen transmission, expand connections, improve utility performance, and support regional trade.

Where private local providers dominate, governments should create transparent regulations, encourage interconnection where technically practical, and help providers move away from expensive diesel generation.

Where communities are far from existing networks, mini grids and household solar systems may be the most realistic solution.

Across all these systems, leaders should publish reliable data on access, tariffs, outages, generation sources, and planned investments. The lack of current and comparable information makes it difficult for investors, researchers, and the public to judge progress.

Governments should also distinguish between electricity for basic access and electricity for economic production. Both matter, but they require different levels of power and different types of investment.

From Access to Advantage

The Horn of Africa is not simply waiting for electricity. It already contains national grids, private providers, solar systems, regional interconnectors, and major new investments. The task is to make these pieces work more effectively together.

The region should not describe itself as powerless. Nor should it pretend that the existing systems are sufficient.

Its opportunity lies between those two extremes.

Affordable electricity can make local manufacturing more competitive, improve agricultural production, support health care, expand digital services, and create better employment. Regional electricity trade can turn energy resources into shared economic value. Private providers can remain important partners while operating within clearer and more efficient systems.

The real goal is not merely to keep the lights on. It is to use power to build productive economies.