Africa has the minerals the world needs. What it does not always have is the electricity to turn them into finished products.
That uncomfortable reality is beginning to catch up with governments across the continent as they push mining companies to build refineries and smelters at home rather than ship raw materials overseas.
From Guinea’s bauxite deposits to Zimbabwe’s lithium mines, the ambition is much the same: create jobs, attract investment and keep more of the money generated by Africa’s mineral wealth within African economies.
But there is a problem. Processing minerals can consume vast amounts of electricity, and the power must be available at a price that allows factories to compete internationally. In many African countries, neither condition can be taken for granted.
A Reuters report published on October 19, drawing on interviews with government and industry officials at African Mining Week in Cape Town, reveals just how serious the challenge has become.
The problem is no longer simply about building new factories. It is also about keeping existing ones open.
Guinea’s big plans face an electricity test
Guinea is one of Africa’s most ambitious countries when it comes to turning mineral resources into industrial wealth.
Having overtaken Australia as the world’s largest bauxite producer and exporter, the West African nation wants to move beyond supplying raw material to China’s aluminium industry.
The reasoning is straightforward. If Guinea has the bauxite, why should so much of the money from processing it be earned elsewhere?
The government wants five alumina refineries operating by 2030, with a combined annual production capacity of between seven million and eight million tonnes.
Three are under construction, according to officials, as Africa Briefing reported in its coverage of Guinea’s refinery expansion.
The ambition goes further. Guinea eventually wants aluminium smelters and steel mills, allowing it to build industries around both its bauxite and iron ore reserves.
There is, however, a considerable gap between those plans and the electricity available to support them.
Daouda Diakité, a senior adviser to Guinea’s mines minister, told Reuters that the country currently generates about 1,000 megawatts of electricity, mainly from hydropower.
He estimated that Guinea would need between 5,000 MW and 10,000 MW to support its wider industrialisation ambitions, including aluminium smelting.
That is at least five times its reported current generation level.
Even the electricity Guinea produces is vulnerable to seasonal changes. During the rainy season, it can export power to neighbouring countries. In the drier months, it sometimes has to import electricity.
For an industry that needs dependable power throughout the year, that is hardly an ideal starting point.
‘The main issue is infrastructure and energy, mostly energy,’ Diakité told Reuters.
Guinea is exploring different energy options, including gas, coal and nuclear power, to meet future industrial demand.
But attracting investors to build power stations will require financing, infrastructure and commercially viable agreements of its own.
The country faces a difficult task: developing its electricity system while simultaneously trying to establish industries that will place even greater demands on it.
South Africa shows the cost of getting it wrong
Guinea’s challenge is largely about creating new industrial capacity. South Africa has a different problem. It is struggling to preserve processing industries that have existed for decades.
The country’s ferrochrome sector offers a particularly troubling example.
South Africa holds more than 70 percent of the world’s known chrome reserves, an advantage that helped make it a major producer of ferrochrome, an essential ingredient in stainless steel.
Yet many of its smelters now stand idle.
According to industry figures reported by Reuters, fewer than a dozen of the country’s 66 ferrochrome smelters are operating.
The reason is not a shortage of chrome.
Electricity prices have increased roughly tenfold since 2008, undermining the competitiveness of an industry that depends heavily on affordable power.
China, meanwhile, has expanded its ferrochrome production capacity and become the world’s leading producer.
The contrast is difficult to ignore.
South Africa possesses enormous reserves of the raw material, but China has built the processing capacity needed to dominate the market.
Mzila Mthenjane, chief executive of the Minerals Council South Africa, told Reuters that the experience demonstrated the importance of reliable and affordable electricity to industrialisation.
For other African countries hoping to build smelters, the message is clear.
Being close to mineral deposits can reduce some costs, but that advantage quickly disappears if electricity becomes too expensive.
A refinery or smelter does not become competitive simply because it is built next to a mine.
Mozambique’s smelter offers another warning
Mozambique provides an equally sobering example.
In March 2026, Australian mining group South32 placed its Mozal aluminium smelter on care and maintenance after failing to secure electricity at a price that would allow the operation to remain commercially viable.
The decision was particularly significant because Mozal had operated for about 25 years.
It was not a speculative industrial project struggling to get off the ground. It was an established operation that had contributed to Mozambique’s economy for a generation.
South32 said it had spent six years negotiating with the Mozambican government, Eskom and other stakeholders but could not secure sufficient, affordable electricity beyond March 2026.
Drought conditions affecting regional hydropower supplies had added to the difficulties.
For Mozambique, the suspension is an awkward reminder of the gap that can emerge between industrial ambition and economic reality.
The government has been tightening control over critical minerals and encouraging more local processing as part of efforts to capture greater value from its resources.
Yet the Mozal experience shows that retaining processing industries can be just as challenging as attracting new ones.
Without dependable electricity, even established factories can become difficult to sustain.
Export bans cannot build factories alone
Across Africa, governments are increasingly losing patience with an economic model that has allowed raw materials to leave the continent while much of the manufacturing value is created abroad.
Zimbabwe wants more lithium processing at home. Guinea is encouraging bauxite producers to invest in refineries and other infrastructure. Mozambique is introducing tougher conditions for exporting unprocessed minerals.
These are not unreasonable ambitions.
Africa has supplied raw materials to global industries for generations, often capturing only a limited share of the wealth created when those resources are refined, manufactured and sold as finished products.
Governments now want more of that value to remain at home.
In Zimbabwe, for example, Chinese mining company Huayou has proposed a lithium carbonate plant that could help move the country further into the battery materials industry.
As Africa Briefing reported on Zimbabwe’s battery-grade lithium plans, the proposed investment reflects Harare’s determination to move beyond exporting lower-value mineral products.
But there is a difference between encouraging local processing and creating the conditions needed to make it profitable.
Alumina refineries, aluminium smelters, ferrochrome plants and lithium processing facilities do not have identical energy requirements.
What they share is a dependence on suitable infrastructure, skilled labour, financing and access to markets.
Export restrictions may encourage companies to consider domestic processing. They cannot, on their own, deliver the electricity or investment needed to make those facilities successful.
That is where industrial policy becomes more complicated.
Investors are asking harder questions
Africa’s mineral processing ambitions are attracting international financing interest.
Institutions including the US International Development Finance Corporation and Africa Finance Corporation are supporting projects intended to strengthen African participation in global mineral supply chains.
But mineral reserves alone are not enough to convince investors.
Franklin Edochie, deputy director and head of mining at Africa Finance Corporation, told Reuters that electricity, reliable mineral supplies and access to capital were among the essential requirements for developing processing industries.
These are often multibillion-dollar investments.
Before committing that kind of money, financiers need to know whether a facility will have electricity, whether government policies are predictable and whether customers will buy what it produces.
Egypt’s deputy minister for strategic industries, Mohamed Zada, identified four considerations: reliable feedstock, power, stable policies and committed buyers.
None can safely be ignored.
The challenge for African governments is that attracting investment in mineral processing increasingly means attracting investment in electricity generation, transmission systems and transport infrastructure at the same time.
That makes industrial development more expensive and complicated than announcing a new refinery or restricting raw mineral exports.
The next challenge is keeping factories running
None of this means Africa should abandon its ambition to process more of its own minerals.
The economic case for developing local industries remains compelling, particularly as countries seek to create skilled jobs, broaden their tax bases and reduce dependence on raw commodity exports.
But governments may need to rethink how they pursue those goals.
For some countries, dedicated industrial power projects could help make major processing investments viable. Others may benefit from stronger regional electricity networks that allow power to move more easily across borders.
There is also a case for regional processing centres.
Rather than every country attempting to build every type of refinery or smelter, neighbouring economies could develop complementary industries around shared infrastructure and mineral supplies.
Such cooperation would require difficult political choices. Governments understandably want factories and jobs within their own borders, particularly when they are under pressure to demonstrate that mineral wealth benefits ordinary citizens.
Yet building processing capacity that cannot compete internationally would do little to solve Africa’s long-standing industrial challenges.
The experiences of Guinea, South Africa and Mozambique point to different stages of the same problem.
Guinea wants to build an industry but needs far more electricity to support it. South Africa has watched a once-competitive processing sector struggle under rising power costs. Mozambique has seen an established aluminium smelter suspended after affordable electricity arrangements could not be secured.
Together, they offer a warning that African policymakers would do well to heed.
The continent’s mineral wealth gives it an enormous opportunity to become more than a supplier of raw materials.
But that opportunity will not be realised through export restrictions, tax incentives and refinery announcements alone.
Factories need electricity. They need it reliably, and they need it at prices that allow them to compete.
Africa has spent decades supplying the minerals that help power industries elsewhere.
Its next challenge is making sure it has enough power to build those industries at home.
