Could you introduce the Energy and Extractives Global Practice within the World Bank?

As the world’s largest global development institution, the World Bank is at the forefront of promoting sustainable development in the energy and extractives sector. Our Energy and Extractives Global Practice is committed to advancing innovative solutions that drive economic growth while protecting the environment and promoting social inclusion. In the next year, our top priorities include expanding access to clean energy, supporting responsible mining practices, and improving the livelihoods of communities in resource-rich countries.

We were among the first institutions to focus on critical minerals for the energy transition. We support mining countries and state-owned enterprises to unlock value-addition opportunities, improve governance, transparency, performance, and private sector investment, and contribute to policies that will benefit all people and support green, sustainable mineral supply chains.

Demand for critical metals like copper or lithium is on the rise – how is this shaping African mining?

Africa has significant mineral wealth, including over 60-70% of the world's cobalt supply and large undeveloped resources of lithium, which are essential for decarbonizing the global energy system. But Africa’s mineral resource potential is largely untapped because of insufficient investments in geoscience information, an unstable investment environment, inadequate infrastructure, and a lack of skilled workers.

For example, Central African Copperbelt producers face energy hurdles that constrain mineral processing and downstream value addition, as well as inadequate rail infrastructure.

Improving energy infrastructure is also crucial. The mining sector in Africa is highly energy-intensive, requiring massive private and public investments. This is both a constraint and an opportunity since a growing mining industry can be long-term paying customers that serve as an anchor for investments in national power systems. Adequately done, investments in infrastructure can stimulate development and alleviate rural energy poverty while meeting the needs of the mining sector and reducing carbon emissions.

How can the transition away from coal be done in a fair and equitable way in countries that heavily rely on coal for its energy, like South Africa does?

Many African countries are facing an energy crisis, and it is difficult to consider a transition away from coal when there is not enough energy. That’s why scaling up renewables to phase down coal-powered generation is critical to providing clean energy for all and meeting climate goals.

Today, South Africa’s highly coal-dependent power generation is aging, unreliable, polluting, and unable to keep up with demand. The current power supply gap is estimated at 4-to-6 GW causing load shedding of up to 10 hours daily, affecting people's day-to-day life and the country's economic prospects.

We support South Africa’s public energy utility, Eskom, to decommission the already closed 56-year-old Komati coal-fired power plant, repurpose the area with renewable energy and batteries, and create opportunities for workers and communities. The World Bank is supporting this transition will almost US$500 million that aims to provide a blueprint for a just energy transition in South Africa and beyond.

How can Africa capture more downstream investments?

The global efforts towards diversified and resilient supply chains create opportunities for African countries to capture more economic activity on the continent and create good-paying jobs. According to our research, Africa could attract between Us$300 billion and US$800 billion in potential revenues in the downstream value chain by 2030, in industries ranging from automotive, construction, and machinery production to other metal fabrication.

There are already successful examples of countries that have taken steps to unlock their downstream potential. Zambia and the Democratic Republic of the Congo signed a cooperation agreement in April 2022 to form the “Zambia‐DRC Battery Council” to increase mid and downstream activities in electric vehicle battery production.

Creating downstream value addition is at the core of the World Bank’s work to translate mineral wealth into sustainable development. We support long-term engagement in policy dialogue and securing investment to achieve that goal, such as enhancing good governance and environmental and social standards, investing in strategic infrastructure and human capital, and facilitating Intra-African cooperation and trade.

We have defined a six-point agenda: Increase Africa’s supply response capabilities through support for mining investments; Unlock long-term, regional development through strategic transportation infrastructure investments; Support investments in renewable energy; Support value addition beyond mining to capture more value for African countries; Invest in human capital formation to allow Africans to seize income opportunities from the booming sector, its downstream value chain, and economic diversification; Strengthen governance and environmental stewardship.