Highlights

• World Bank paper by Ngozi Okonjo-Iweala positions Africa as a necessary pillar for global economic resilience.
• Africa holds 30% of the world's mineral reserves, including 15% of rare earths.
• Africa accounts for less than 3% of global trade.
• Africa's bottleneck isn't geology but value addition and infrastructure.
• Trade costs in Africa run 37% higher than global averages.
• Slow AfCFTA implementation blocks regional value chain development.
• For critical mineral investors, Africa can diversify global supply chains only if:
  • Capital pairs with permitting certainty.
  • Infrastructure delivery is secured.
  • Credible local partnerships are formed.
• Investment in Africa is not optional, but not turnkey either.

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A new World Bank Policy Research Working Paper, authored by Ngozi Okonjo-Iweala, makes a bold claim: Africa is no longer a peripheral player in global supply chains but a necessary pillar of future economic and strategic resilience. Delivered as the 2025 Mattei Lecture and published in January 2026, the paper argues that overdependence on a handful of regions—China for critical minerals, East Asia for semiconductors, and the U.S. for demand—has made the global economy fragile and weaponizable.

From a Rare Earth Exchanges™ perspective, the framing is notable. Africa is presented not merely as resource-rich, but as systemically underutilized—holding nearly 30% of the world’s known mineral reserves (15% of rare earth elements), including rare earths, yet accounting for less than 3% of global goods trade. The bottleneck is not geology; it is value addition, infrastructure, and policy execution.

From Extraction to Leverage: The Value-Addition Gap

The paper accuratelydiagnoses Africa’s central challenge: exports remain overwhelmingly commodity-based, with minimal downstream processing. High trade costs—up to 37% higher than global averages for manufactured goods—and slow implementation of the African Continental Free Trade Area (AfCFTA) continue to block regional value chains.

Where the paper is strongest is its linkage between critical minerals and global resilience. Okonjo-Iweala explicitly notes that if African rare earth and critical mineral value chains had been developed earlier, recent Chinese export controls would have triggered far less alarm. That observation aligns with hard lessons now being learned in Washington, Brussels, and Tokyo.

What’s Real—and What’s Aspirational

What holds up under scrutiny:

• Africa’s demographic advantage is real: the working-age population is projected to reach 1.6 billion by 2050.
• Select projects already validate the thesis, including Malawi’s Songwe Hill rare earth project backed by the U.S. DFC and designated strategic by the EU.
• Infrastructure gains like the Lobito Corridor show logistics can materially improve when execution occurs.

Where caution is warranted:

• The paper leans heavily on “potential” while underweighting execution risk, including various challenges at a country-to-country level.
• Governance variability, security concerns, and capital discipline are acknowledged but softened.
• Europe’s proposed “modernized Mattei formula” is compelling rhetorically, yet remains largely unproven at scale.

Why This Matters for Rare Earth Supply Chains

For rare earth and critical mineral investors, the message is clear: Africa is not optional—but it is not turnkey. The continent can diversify global supply chains only if capital is paired with permitting certainty, infrastructure delivery, and credible local partnerships. Without that, Africa risks remaining a strategic talking point rather than a functional alternative.

The paper is best read not as a forecast, but as a policy challenge to the West:resilience requires building new nodes, not just reshoring oldones.

Source: World Bank Policy Research Working Paper 11295, African Trade and Investment for Global Resilience (opens in a new tab) (January 2026).

Disclaimer: This analysis is based on a World Bank working paper reflecting the author’s views, not necessarily official institutional positions.