Key Minerals of the African Continent: After the Sahel Region Countries, Southern Africa Joins the Resource Nationalism Wave

¬ Botswana now requires mining companies to transfer 24% of their exploration licenses to local investors, marking a significant shift toward resource nationalism in southern Africa

¬ Zambia has enacted the Local Content Statutory Instrument, requiring that at least 40% of mining products be sourced from local suppliers

¬ Zimbabwe plans to grant the state a free 26% equity in all new mining projects, as part of a broader effort to strengthen national control over mineral wealth

¬ Strengthening Local Interests in Mining Industry in Botswana

Botswana announced a new regulation on October 10, requiring mining companies to transfer 24% of their licenses to local investors. This measure comes into effect on October 01 and aims to promote local participation in an industry traditionally dominated by multinational corporations.

This policy is similar to the resource nationalism initiatives taken by the Alliance of Sahel States (AES), which consists of Burkina Faso, Mali, and Niger, countries that have also strengthened their control over natural resources.

Botswana introduced this regulation as it tries to expand its control over diamond production. The government holds a 15% stake in De Beers, and is expected to participate in ongoing negotiations with Anglo American. Anglo American plans to sell its 85% stake in this diamond giant for about $5 billion. Approximately 70% of De Beers' global output comes from Botswana.

Zambia Implements 40% Local Procurement Rules

The government of Zambia, the second-largest copper producer in Africa, approved a "Local Content Statutory Instrument" last week, mandating that at least 40% of goods and services purchased by mining companies must come from Zambian enterprises. According to local media such as the Zambia Observer, this regulation was announced at the recent Zambia Mining and Investment ICA Conference.

Despite the billions of dollars in foreign exchange generated by Zambian mining annually, the participation of local businesses remains limited. Recent statements by Member of Parliament Brian Mwambuluhu indicated that locals account for only 5% of the industry's value chain. A 2022 report by the African Development Bank showed that enterprises owned or managed by Zambians accounted for only 13% of mining-related procurement, while many so-called "local" suppliers are actually subsidiaries of foreign firms.

Zimbabwe Pushes for 26% State Participation

Zimbabwe, the largest lithium producer on the African continent, is also pushing for state participation in its mineral resource development. In December 2024, Mining Minister Pfungwa Kunaka told Bloomberg that the government would require the state to have a 26% free equity in all new mining projects.

This policy complements Zimbabwe's 2019 Local Content Strategy, which aimed to increase local participation in key value chains from 25% to 80% by 2023. Zimbabwe is also a major producer of platinum group metals (PGMs) and sees greater domestic ownership as a pathway to broader industrial development.

Challenges in Local Empowerment

Experts warn that while these measures can strengthen resource sovereignty, their success depends on whether local businesses can effectively compete. Dr. Ahmatou Mohamed Maiga, a West African mining analyst, said the key challenge is "not just setting participation quotas but building a true local competitiveness ecosystem."

He emphasized the need for tailored financing mechanisms to help domestic entrepreneurs secure contracts and link up with universities and industry bodies to implement technology and management training programs.

Sources: ecofinagency

Original: www.toutiao.com/article/1846100274096137/

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