The exploitation of mineral resources in Africa

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UNITED NATIONS

AFRICAN INSTITUTE FOR ECOHOMIC DEVELOPMENT AND PLANNING

CS/2796-e Rev.1

D A K A R

THE EXPLOITATION OF MINERAL RESOURCES IN AFRICA

by

Dr. G.M. HAMID

A Paper Presented To The Seminar

Technology And Industrialization in Africa 14-16 January 1978 - ALGERIA

PRELIMINARY NOTES

SEPTEMBER 1,78'

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CS/2796-e Rev.~

Page 1 INTRODUCTION

EXPLOI'"¹¹ATION OF MINERAL RESOURCES IN AFRICA

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The purpo9!; of this paper is to show .:that A:f.rica is ric,h in mineral and e..nergy resources com:pa:red to other Continents. and that this mineral wealth has been expl_oited for over century by the developed Capitalist Countrieso

Moreover a survey o{ the changes in the policies of mineral indu·s- tries ove~ the last de~ade wil!. be examined~ to see to what extent

African countries have succeeded in controlling thei~_mineral industries • .

The paper is essenfially informative.

Te MINERAL RESOURCES IN AFRICA

Ih. Energy Resources. In Africa ^{-~ ..}

Introduction

There is no question that Africa .has .imm~.ns.e" eri.ebg.y. sôu~oes· .,;,hi ch . could provide a suprPr.t for· i ts de.velopment for a fai:rly lortg time to

come. It has combustible so~ids,.hydro~carbons, hydroelectricity, non"

co~ven~ional forms of energy.such as fi~sile mineralsi solar energy~

geothermal energy, marine. thermal energy, wind power;- v5=;:getable fuels, etc • . In the following pages an_ attempt .wi.ll b.e made· to evaluate the magnitude, distr.ibution and use !Tlade of them at . present ..

Resources and Production

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a. Coàl and Lignite

Africa's coal reserves are estimated at 88.5 billion recoverable tons.

It is very difficult to establish Africa's share of world reserves• Estimates of world coal resources na_. ve· vaT-ied· consi-d.erably. in th_. e· last

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50 years be cause of conflicting· èvaluations. · Taking· thè highèst ··figures o.f 7 ~ ~00 * billi-on tons, A{rica would have only 1.1'6 ·per cent of the world' s reseives of coal. On the basis of 'the loweet estimat e of (2i 900 billion t~ns**) Africia's s~are ~ould be 3.05 p~r cent.·

~ased on the 1973 production rates, Africa¹s coal reserves may be exploited for, 1,301 years. African coal reserves are 172 times larger than hfrican's t~tal _~~ergy produc~ion estimated at 5{6 mill{on tons of coal equivalent. Compared to world coal production Af~i~a•s. shaie has increased from 1.03 per cent in 1929 to 2.79 per cent in 1973.

Bath the resources of coal an~ production are unevenly distributed in Africa. The main coal deposits are in South Africa 72 billion tons and Southern Rhodesia 7 billion t'or!s ,- and t-heir --combi-ne·d share · account for 95 per cent of Africa' s known e·vallJa:t;èd. cgra_l _:r:·ese_rves.

b • . Petroleum and Natural Gas

The proved reserves of petroleum in Africa were estimated in 1974 at

68 billion barrel'S or abotit 9 per c'en~ • of the total world re.serves which were ~stimst~d at 720 billion barrels. The estimates of Africai~ share made

by

ECA : amounts ta more th an 1196.. The-reserves of petroleum are concentrated in very few countries, Libya being at the ·top with about 43

per cent ; Nigeria 28 per cent atid Alg~ria 16 per .certt o.

In 1972, .the distribution of total petroleum production ln Africa was as follows: Li bya 36.6 per cent, Nig~·r-ia

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^{5 per cënt'~· A'lgeria 17.3}

per cent which is as similarly concentrated in few count~ies as t he reserves.

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Estimates of the Geological Congress of Toronto 1913.

Estimates of the US Geological Survey in 1972.

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Nat-ura:J_ ·Gas

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African reserves 'of natu.ral gas were ~stimated by the US Bureau of :t-1i~es at 196 trillion cubic foot in .1974 which. rep~eseni·.ed 976 of the estimated world reserves of 2;146 trillion cubi; footo The ECA estimates of ~frica's natural gas reserves amounted to 10o3 per cent ·of world

reserves. Natural gas de~osits ·ar~ located in North Afri~a~ primarily i::1 Iü geria, the Litbyan Arab Republic1 and in Nigeria with 43 per cent, 16 percent and 28 per cent of Africa's r~se~Ves .respectively~ With regard to natural gas production~ Libya produc~d 66 per cent₁ Al geria 30 per cent and Nigeria 1.2 per cent iR 1972.

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Ur.<;mium and Thorium

·africa's ur~nium reserves in 1973 wère report ed to be 271,800 metric tons or a third of the total world potentiai~· · Other estimates show that

Uric.a ¹ s share is éven higher than· one .thi'Td ·of world reserv:.es. Africa ¹ s share·in ~orld produttion of ~~anium amounted to about 21 per cent in 1973~

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Both the resoùrces of uranium and its 'production are very unevenly di stributed among African count:=-ies~ Only six countr~es .have (so far)

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known uranium res6urces and their respective shares are as follows~

South Africa 68· per cent, Niger 18 per · cènt, 'Gabon 7 per cent'· Central Af~ican .Republic 3.5 per cen~~ ~ngola 3 percent and Zaire 0.7 per cent of ~fri;~¹ s total resources of uranium. South Afr{ca's shar e in Africa¹s uranium production was 66 per centj Niger 24.5 per cent and Gabon 9.4 per cent in 1973.

Hydroelectricity

Africa¹s technically exploitable hydroelectric potential would appear to be about 1 ,_630 million kWh per year ~ or more than a than a third of the exploitable hydroelectric potential of the submerged l and of the globe. This annual average production capacity represents almost

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15 times the total electricity productibn of Afrioan oountries in 1973 and 52 times the Continent ¹ s total hydroeleotric productio·n. Compared wi th world product·io:n, i t -represented tn 197 3 41. 5 per Mnt of total electricity production·and 123.p~r cent of total hydroelectric energy production.

This African potentiéi.l of hydroelectricity has harcily been tapped,

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·if ~t is .remembered that the·tota1 installed hyd::roelectric. capac1ty in Africa was only 8. 7 million ki'· lowats or about 4. 36 per c'ent of the techni- cally exploitable c~paci ty of "th~ continent.

Moreover, African hydroelectric po·tent±al is very unevenly distributed. The Central Africa subregion alone has minimum potential of 744 billion

.. kWh per year, or about 46 per cent of the continent ¹ s- ~o,tal hy.droelectric potential, i•rhile North Africa has only 5 per cent, lil~st Africa about 10 :9.er cent, Eastern .A:f'rica has 22 per cent and Southern Africa about 17 per cent. It is unquestionably tropical and equatgrial Africa¹s hydroelectri~

potential which cons ti tu tes the continent ¹·s major and decisive as set for its future energy deveJ;opment.

Africa ¹

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specifie hydroelectric potential is. very favourable compared wi th other co:ntinen~s. Per capita, .i t represents more·than 3 times the

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world average and, in terms of area, more than 1. 5 tirrles the· average per square kilometre for the .countries of the world as a 'whole.

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0 th er Pot en ti al Source ^s._.') l".:~:r...c:._~r;~-.

It is still early to examine thoroushly the potentialities of Africa in sources of energy ether than thcse cxamined in the above

·paragraphs:.' The re inclu.de ₁ sol.al~ energy, wind energ'y ~ gee thermaL energy? h.eat energy from the se a and oû1er fuels" \4i t~ regard ·co solar energy ~ i t is est:i.mat.ed .that mo.re ·chan half the world solar ene:rgy prospects are to be found in Africa \vi ·èh i ts Saha.ra; Nu bian

·and K~J ahari desertsn With regard to the remaining sou~ces of energy ii; is st:;_l l early to assess the future . potent\ali ti es of Africa,

IB, 'letals and Ores

Reserves~

Africa has large r esour ces of ~n ·~1 R anrl nre~ and many of these have not yet been serious:y explored. They can be divid~d into thiee groups

according to the share ·of Africa in world to~aJ. estimated re~erves in

1974a The first group ~s made up of tho~e metals and Ores i~ which Africa is comparativeJ.y better endm·;ed ·than other continents or regj ons

'(i~e- it has a 3hare Sc<.bst.:mti.ally higher than its share in world tata] population which arnollnted to 9c9% in '1973*)"'· This first group is ~ade up of s~ven m::.ne::·als \vi·~i:. the fé:>l:Lo·,,ririg shares in tata=~. world reserves, di amand over 90 ^{per cent., -'-1."~ :J~.~~.!!l} 97 ^{per· cent~ phosphace}

rock 72 per cent. goJ.d GL:- per cent- manganese 50 per cent~ cobalt 42

per cent and alumin·.;_ um 33 per 0entn 'l'he second group is made up of copper with 13% of total ^{~:J r~serves ~nd} as s~ch just a little bit higher 'chan . the sha~e of Africa in vJorld population~ Group three is made ll~ minerals in w~ich Afric~ cioe~ not compare well with the rest of th: continents₇ and these are w~~h the'foll6wing shares in world total reserve31 tin 7 per cent~ zinc 6 per ceritJ lead 3 per cent and iron Qre 3 per cent. See Table (1)~

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* Including South AfricaJ Zimbabwe (Southern Rhodesia) and Namibia~

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Production

Tbc share of Africa is yery high in the w6rld t~t~l produ~tion of gold 979.2. per cent, diamonds 76.6 per cent, cobal t

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per cent,

chromium 32.& per cent, manganese 32.8 per cent, phosphat~ rock 28.9

per cent, çopper. 20 per cent, asbestos 16.9 p~r cent~ In the production of other non energy minerals Africa¹s share ~s not v~ry si~nificant

such ~s iron ore 9~5 per cent, tin

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per centj l ead 6o2 per cent~

Uneven Distribution of Reserves and Production of Non -~ Minerals The resources and production of metals and ores is badly and unevenly distributed in the continent. Only 14 out of t~e 52 African countries can be considered as important producers of one or more of

'these· minerals., Another aspect of the uneven distribution is that ~ the"

main producing couhtries are situated in the southern part

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the conti- nent. · Th~se are South Africa, ~aire, Zambia₁ Namibia~ and ~ngola. In • the nor~he~n part of the continent, only Morocco and in the rest of the continent only Liberaa, Ghana, and Guinea are importa~t producers, The r esourCts and nroduction of each of these mineral resources is concentrated

in on( or two countries and sometimes in three countries. Soutt Africa for èxampl e has over 90 per cent of the resources of gold~ chromium~

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mang~nes~. Morocco has more than 90 per cent of the resources of phosphate rockft Guinea has 61 per cent of bauxite reserves, while Zaire has about

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^{per cent of he resources of ea}ch of cobal t and tinn Zambia and Zaire have more than 80 per cent of resources of both copper and cobal t . Nigeri E and Zai re hàve

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per cent of the tin resourcesu The only reserves of metals which are found in sever~l African countries are iron ore! l ead and zinc.: With regard to the value of _exported metals and ores from Africa excluding South Africa: .the first mineral is copper ~ith export

Eo-arning amounting to $1, 118 mi-l lion, followed by iron ore, $320 million1

eructe phosphate $209 million, diamonds $190 million, aluminium and bauxite $100 millio~ and tin $55 million in 1972o With regard to the

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value mi neral experts of South _. Africa, precious ston_{. . .} es accounted for

about $700 ~illien,. minera~ products $350 million and base metal produ~ts

for $500 million ~n 1973. Sa it is clear from these figur~s that copper

·and precious stones account almost for about 50 per cent. of the value oféxports of metals and ores ln Africa.

,.fric a ' s Export9 of Fuels and ether minerale

·In 1973 Afric~ exported about 75 per cent of the energy it produced and despite its relative wealth still importa 13 per ~ent of its needs o Fuel exporta (mainly petroleum _. and natural gas) _. . ar. e accounting for an

increasing share of total African experts, rising from 0.8 per cent in 1955 to 20.8 per cent in 1965 and reaching 43.7 per cent in 1973. The main

conpon~ntn of • fuel export e rnings are petroleum and natural gas, and

': :·i-:J~iünJ experts al though they account for a big shar'~ of world total uranium 'trade they account for a small proportion of •Ürica' s export earnings. The value of the petroleum exporta of Africa has increased from about US $355 mi:lliQn in_ 1955 . to. US $1 ,61,2_ m;i.l],io,n,jn 1965 and

~ising sharply to .US $8,897 million in 1973o

Direction of Petroleum Experts and the Increasing Dependence of Developed Market Economies on African Petroleum

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~frican orude petroleum is baeically ~xported to th~ developed

m~rket economies. The èhare of thesa ecionomies in total African petroleum experts amounted to 90.7 per cent in 1965 -and 87.3 per cent in 19?3'-

The ·corresponding shares of ·the -developing. ·market · economies were 6.1

pcr cent and 10.2 per cent while the corresponding shares of the centrally planned economies were 0.2 per cent and 2.3 per cent.

In 1973, the percentage shares of the main importera of African petrolétlm·-were as ·follows, the' EEC' coûl'!!lries (excluding U.K., Ireland and Denfuark) 47 p~r cent, the U.S.A~ 15.5 per ~ent, U.K. 11.8 per cent, New EFTA 3.5 per cent, Japan 2~7 per cent and Canada 1.7 per cent

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(see Table 5). The develop~d market economies are heavily dep~ndent on the imports of fuels. This dependance is actually increasing since the

net imports of total energy as a per .cent .of .to±.al e,ner.gy consumed· .. increased between 1960 and 1973 from 6 percent to 16 percent in the U.BoA., from 44 pcr cent .to 88 percent in France, from 9 per ént ot 56 pcr cent in t he. Feder~l Republic of Ger~~ny, from 70 per cent to 89 per cent in Italy~

from 23 percent to 50 pe! cent in U.K., from 30 percent to 64 per cent i n the EBC as a whole and from 47 per cent to 100 per ce.\].t in Japan.

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The imports of fuels (mainly petrol~um) of the developed market economies from Africa excluding South Africa have been continti6usly in

incr~asing in absolute t erms and as a percentage of thcir total fuel imports. In 1955 these fuel imports ac6ounted for an insigni~icant share of Oo1 per cent, while they increased to 11.5 per cent and to 15.4 per cent their ·total fuel imports in 1965 and 1973 respectiv~ly.

Direction of African Experts of Metals and Ores

The chief importers of. Africa's* metals and ores are the developed

mar~e.t .economies, who se sha.r:e in the experts of th~ir minerals ·accounted in 1973 for 90 per cent.. The corresponding figures are aE3 follows,

deve.loping market economies 6 .• 7 .per cent, certtrally_ planned economies of Europe 2a1 per centf. Africa excluding South Africa ,~7 per cent. Among t he developed ~arket economies, the chief importers of these met als and ores

~re the EEC (excluding U.K, -Irel and and Denmark) with 52 .. 5 per cent, · Jnpan with 14.3 per cent, U~K. with 11.3 per cent anct U.S~A. 3.,8 per cent.

The _developed market economies as a whole import a smnll but

~:;ignificant share of their total imp,orts of metal and ores from Africa. In î965 i t amounted to 7 ^o 9 per cent from developing ,:.fric a and 2. 4 per

cent from South Africa* * ^o 1:6, r.::l9·73 i t o.mcuryted ;:;to 6.2 pe:ztoeJlt. from developing

~,frica and the corresponding figure for South Africa i s not avai lable but

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Bxcluding South Africa •

Figures for South ~frica a~e calculated by the writer from Handbook of interested trade on Development Statistics, 1976. UNCTAD GenevaJ and ether sources.

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i t is expect ed to be higher than in 1965, as a resul t in the rise of gol d priees and ether precious met als. The individual countries. and economie group ~ithin the developed market economies. vary substantially in their need and dependance on imports of metals and ores from •. frica.

In 1973 Britain imported•27~1 percent of its total import~ of ores and met.::l s Îrom devel oping li..frica, thè·corresponding .figures were 8e5 per cent for Japarr, 8.3 per cent EEC (six members) and 1.6 per ~ent for USA.

;.fri ca i~ the biggest exporters of gold and diamonds in the world, and i ts sharc ip total experts of copper is 23 per cent, iron ore 11.5 per cent on ~972 and accou~ for a significant share of uranium experts.

II. A CENTURY OF EXPLOITATION OF THE MINERJ\.L WE.J.,TH OF ù.FRICA BY THE Cii.PITALIST COUNTRIES

The rich mineral ~ealth of hfri~a, which is briefly exarnined in s,;.ction

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of ,this paper' has occupied a prominent pl ace in the plans of the Capitalist countries for the military conquest, poiitical domination and economie exploitation of the •black' continent. The l ast third of the 19th century witnessed the beginning of more than a century of exploi- tation, 'When the diamond and gold mines ·of Sout·h -Africa \vere bei ng

discovered. British capital found in them an ·outlet fo~ investment v•hich continued to increase since that tinie and at -present occupies a promincnt place. These were followed l at er on by the exploi tation of the rich reources~of Southern hfrica's strategie miner al s such as uranium, manganese, cobal t , chrome~ copper, t o name only few of the important onee.

The Interwar peri6ds witnessed the· b~~ning of the rich re$ources of coppcr and associated minerals in the copper bel t in Zambia~ Zaire and Rhodesia, fol lowed by the exploi tation of ~etroleum1 natural gas in Porth .-.fric a and Nigeria, bauxite in Gui ne a , iron ore in Li beria and Maurit ania, urariium in Gèbon, Nigeri South Afri cia and Namibi a during the 1960s and 1970s. The l eading foreign mining companies in Africa

are hmerican, British, French, Italian, Belgian and l ater on Japanese cnes~