Securing Minerals for the Energy Transition 2025

Illustration of a transportation barrier BOX 4 Disruptions in port operations at Maputo, Beira and Nacala ports in Mozambique.19 Type of transportation Key challenges Port authorities and shipping services –Port congestion often arises from infrastructural limitations, slow processing times, use of outdated equipment and inefficient customs procedures20 –Some ports in SAR countries have seen disruptions in operations and delays in cargo processing and vessel handling, stemming from political unrest and volatility21 –Some SAR countries, such as Botswana, Zambia and Zimbabwe, are landlocked and therefore rely on their neighbours for shipping services Railway systems and containers –The region suffers from poor maintenance of rail and poor coordination between intra-region rail operators –Theft and vandalism on rail networks, particularly those transporting mineral ores, has been reported in railway systems servicing cross-border trade22 –Some railway systems transporting key critical minerals are struggling with debt and a lack of capital required for repairing infrastructure Road transportation and trucking –Over 1,000 trucks per day are used in place of rail infrastructure, leading to 100-kilometre truck queues at borders and delays of up to two weeks –Delays in securing project approvals from key stakeholders are frequent –Outbound minerals exceed inbound cargo (mostly fuel), causing transportation inefficiencies and empty legs –The safety of truck drivers is a concern; approximately 5,000 truck hijackings occurred in South Africa from 2018 to 202123Without a well-developed transportation system, mining project logistics are likely to suffer. This could increase project costs and make financing unattractive. Illustration of an innovation lag challenge BOX 5 The African Private Equity and Venture Capital Association (AVCA) notes that materials made up less than 1% of total private equity and venture capital investments in 2021-22.24 Type of innovation lag Key challenges Venture capital financing –A lack of venture capital to support innovation is a global challenge that adversely affects SAR countries –Promising projects remain underfunded or stalled because of financial constraints Adoption of cutting-edge mining technologies –A lack of collaboration between universities, research institutions and the private sector means fewer homegrown innovations and trained specialists –There is also insufficient mentorship for junior miners Intellectual property policy –Most SAR countries, except South Africa, lack IP protection policies –Concentration of IP in just a few countries makes it difficult to develop local expertise and downstream processing capabilities in the regionLimited venture capital, slow tech adoption and weak intellectual property (IP) protection reduce project appeal for investors.Transportation barriers 4 Innovation lag 5 Securing Minerals for the Energy Transition: Finance for Southern Africa 14