Green industrialisation: Leveraging critical raw materials for an African battery value chain
African countries are exploring opportunities to add more value to their critical raw materials for green industrialisation. Poorva Karkare and Alfonso Medinilla assess the potential for an African lithium-ion battery value chain as a case.
Summary
African countries are exploring opportunities to add more value to their critical raw materials for green industrialisation. This paper assesses the potential for an African lithium-ion battery value chain as a case.
It argues that while green industrialisation ambitions hold promising new prospects for African economies, they nonetheless add another layer of complexity to already existing challenges. The interplay of actors and interests at different levels collectively influences these ‘green windows of opportunity’.
Presently, African countries mainly supply raw materials in the global battery value chain, while China leads in both manufacturing and innovation. The US and the EU strive to catch up, but it is unclear how their geostrategic goals support African industrialisation.
African processing and manufacturing for batteries will depend on establishing a regional value chain, supported by the African Continental Free Trade Area. But this requires overcoming the structural, institutional and coordination challenges that have limited regional industrialisation in the past. At the same time, there is a need for effective implementation of policies at the national level. This involves using limited resources to build domestic capabilities through robust industrial policies while balancing diverse interests and incentives.
To capitalise on opportunities at different stages of the value chain, African countries should (i) improve mining potential for socio-economic development, (ii) implement targeted industrial policy to develop capabilities in the battery value chain, (iii) ensure market access to maximise export potential, (iv) proactively position themselves amid geopolitical competition between great powers, and (v) involve private sector actors early in the process.
This paper is illustrated in the guide 'An African battery value chain to kickstart green industrialisation'.
