With mineral prices high and Russian commodities sanctioned, Canadian firms ramp up lucrative mining projects on the continent
Owen Schalk / June 8, 2022 /
Phosphate mining in Togo.
Photo by Alexandra Pugachevsky/Wikimedia Commons.
The invasion of Ukraine and the resultant Western sanctions against Russia have wrought far-reaching consequences on global commodity flows. These impacts are evident in a number of global shortages, such as the lack of cooking oil in Indonesia and the paucity of fuel in Sri Lanka, the latter of which has been unable to pay for imports since global crude prices soared in early 2022. Food prices are up in the underdeveloped countries of Central Asia, while medical supplies (for which Russia was their largest provider before the onset of Western sanctions) have grown scarcer.
Africa, which imports 85 percent of its wheat (one-third of which comes from Russia and Ukraine), has also felt the strain of the highest food prices in decades. Egypt in particular is scrambling to replace Ukrainian wheat imports, which had previously comprised 80 percent of its stockpile. The Egyptian government had hoped to replace Ukrainian wheat with imports from India, but on May 14, India banned wheat exports, citing the risk of food shortages within its own borders. Thankfully, Cairo has stated that India will honour its previous contract to export 500,000 tonnes of wheat to Egypt, but the future integrity of this arrangement remains unclear, which has led Egypt to seek additional partners in France, Kazakhstan, and Australia.
The price of many important minerals also skyrocketed following the Russian attack. Russia’s economy holds seven percent of the world’s nickel supply, 10 percent of its platinum, 20 percent of its titanium, and 25 percent of its palladium. The price of these metals and others, including aluminum, cobalt, and copper, spiked in March 2022, only to stabilize in the ensuing months, albeit at above-normal prices in many cases.
Some of the most fluctuant minerals are central components of Canada’s $3.8 billion Critical Minerals Strategy, announced by the Trudeau government in 2021 as a way to “capitalize on rising global demand for critical minerals,” to secure inputs for “renewable energy and clean technology applications,” and to guarantee Canada’s economic primacy in the fields of “defence and security technologies, consumer electronics, agriculture, medical applications and critical infrastructure.”
While the Canadian government continues to support the extraction of these minerals domestically, Canada’s mining industry has assumed an increasingly global orientation over the past few decades, especially since the imposition of neoliberal structural adjustment programs (SAPs) on countries across the Global South. Latin America has historically been the most profitable region for Canadian mining companies operating outside North America, but recently, both the Biden and Trudeau governments have spotlighted Africa as an increasingly key supplier for their respective critical minerals strategies.
Steven Fox, executive chairman of New York-based political risk consultancy Veracity Worldwide, has asserted that the Biden administration “wants to position itself as a strong supporter of battery metals projects in sub-Saharan Africa.” These battery metals are an essential component in the creation of electric vehicles and other less fossil fuel-reliant technologies, whose production is described by some as a way of weaning Europe off of Russian energy imports. Additionally, the lack of environmentally appropriate regulations in many African countries, often the result of SAPs and Western advisement on extractive policy, means that mining projects are likelier more efficient—and thus more profitable—to pursue on the continent.
“While Africa presents its challenges,” explained Fox, “those challenges are no more difficult than the corresponding set of challenges in Canada. It may be easier to actually bring a project to fruition in Africa, than in a place like Canada or the US.”
In the context of the Russia-Ukraine war and the increasingly profitable and strategic exploitation of battery metals, Canadian politicians have stressed the need to maintain and expand access to critical minerals on the African continent. In addition to securing a market for Canada’s Critical Minerals Strategy, such access will have the effect of keeping Africa, which has largely sought to remain neutral in the conflict, as a crucial supplier of the minerals with which Canada and its allies hope to blunt the economic blowback of the invasion and of their sanctions programs against Russia.
Canadian capital finances or operates mining projects in over 100 countries, and extraction is growing every year. By 2025, the Mining Global Market Report of 2021 estimates that the global mining and minerals market will reach a value of $2.4 trillion—a compound annual growth rate of seven percent. This growth will be achieved, the report states, with wide-ranging governmental support. “Government policies to support the mining industry [are] expected to drive the mining market,” the report’s summary explains:
Governments are providing subsidies and encouraging foreign direct investments (FDI) in the mining industry. The amount of government support includes the support through governments’ public finance institutions such as bilateral development banks and export credit agencies investing in mining projects, fiscal support through budget allocations and tax exemptions, and investments through majority state-owned mining and utility companies.
Canada is no exception. The Canadian government regularly finances mining operations abroad through its publicly funded state development arms while aggressively lobbying for neoliberal reforms in the countries in which these mines are located. These countries, such as Guatemala, Colombia and Burkina Faso, tend to be underdeveloped states in which the US and its European allies have violently hacked their way into lucrative resource markets, leaving a trail of corpses in their wake.
Prior to the era of structural adjustment, the Canadian government cozied up to brutal right wing states throughout Africa, such as Mobutu Sese Seko in Zaire (between 1985 and 1989, Canada provided his regime with almost $140 million in assistance), apartheid South Africa (Canadian mining companies such as Falconbridge profited from cheap labour in illegally occupied Namibia and elsewhere), and Idi Amin’s Uganda (around one year after Amin announced the expulsion of Uganda’s South Asian population, the Canadian High Commissioner in Nairobi visited Uganda, not to criticize Amin’s policies but to implore him to reverse the nationalization of Toronto-based shoemaking giant Bata Shoes). These policies represented a conscious alignment on the part of the Canadian state with the forces opposed to the left wing pan-Africanist vision of leaders like Ghana’s Kwame Nkrumah and the Democratic Republic of the Congo’s Patrice Lumumba, whose removals were supported by Canadian officials.
In the post-Cold War period, US-led international financial institutions such as the World Bank and the International Monetary Fund were able to impose neoliberal reforms across much of the African continent, allowing Canadian capital to reap the rewards. Canada itself played a notable role in this process; in the case of Tanzania, the Canadian government threatened to withhold aid unless the state accepted an IMF structural adjustment plan, while in South Africa, Canadians were instrumental in pressuring the new ANC government against redistributing the country’s mineral wealth toward its less privileged (in other words, its Black) population.
In the following years, numerous Canadian governments prioritized the negotiation of Foreign Investment Protection Acts (FIPAs) in African countries, legal acts which give corporations the right to sue governments in private tribunals for the “crime” of interfering with their investments. The Harper government negotiated FIPAs with 15 African countries, some of which were signed or announced at mining conventions. Meanwhile, Justin Trudeau announced negotiations for a FIPA with Ethiopia in 2020, and later signed an FIPA with Nigeria.
Former Parliamentary Secretary to the Minister of International Trade Omar Alghabra stated that FIPAs such as these are meant to “encourage increased bilateral investments between our countries by helping to reduce risk and by increasing investor confidence in our respective markets.” His use of the term “bilateral investments” is misleading—these laws are designed to protect the interests of Canadian companies operating in Africa, not vice versa. After all, there are no Malian or Burkinabè mining giants investing billions in Canadian extraction, and Tanzanian companies do not own 50 percent of Canada’s GDP, as Canadian companies do in Zambia.
Over the past few decades, Canadian mining investment abroad has increased considerably, to the degree that foreign mining assets now comprise 70 percent of the total value of all Canadian-owned mining operations—in other words, $188 billion of $273.4 billion. In Africa, the total value of Canadian mining assets is $36.5 billion.
In 2020, 106 Canadian-owned mining companies operated in Africa. Their investments span the continent but are mainly concentrated in a handful of countries. The most treasured countries, each containing Canadian mining assets valued at over $1 billion, are Mali, Mauritania, Burkina Faso, Ghana, the Democratic Republic of the Congo, Tanzania, Zambia, and South Africa. Some other less lucrative but nonetheless important countries, with Canadian assets valued between $100 million and $1 billion, are Senegal, the Ivory Coast, Niger, Namibia, and Botswana. Out of all these countries, Zambia is the most valuable for Canada-based companies, with Canadian-owned assets valued at around $10 billion—approximately half of Zambia’s total GDP, as stated above.
In the most recent edition of Canadian Mining Journal, Bill Kellaway, Colin Rawbone, and John Paul Hunt write that “Global economic recovery and the focus on battery minerals is seeing greater interest in mineral exploration, not least in areas of central and southern Africa.” In this context, Canadian prospectors and geologists are working across Africa, using “the digital revolution” to their advantage by bringing global positioning system (GPS) technology and “powerful modelling software” to regions like the Central African Copperbelt, “allow[ing] historical exploration data to be revisited and more intensively analysed.”
With mineral prices high and Russian commodities largely excised from the investment map, it is no wonder that Canadian companies are seeking profit on a continent that they know will generate significant returns—at the expense of ordinary people in the relevant countries, as always. At the recent Mining Indaba, an annual South Africa-hosted gathering of continental and international figures aimed at promoting the mining sector, Canada’s First Quantum Minerals announced $1.25 billion in new investment in Zambia, whose president Hakainde Hichilema has promised foreign investors that there would be “no mining nationalism” in his country. Barrick Gold has revealed its intention to expand investment talks with Zambia as well.
At the Indaba (which is sponsored by some of the largest mining companies in the world), investments such as these were celebrated under the banner of “energy transition” and “ESG [environmental, social, and governance]” considerations, but it was impossible to ignore the geopolitical context of the event as well. The volatility of global commodity markets in the aftermath of Russia’s invasion of Ukraine, and the need to find less uncertain supply sources for critical minerals, was evident not only in the speeches of government and private officials, but also in the fact that the US sent a high-level delegate to the event for the first time in its history.
That delegate was Jose Fernandez, the US Undersecretary for Economic Growth, Energy, and the Environment, who identified 40 critical minerals on the US shopping list and the Biden administration’s intention to secure them from Africa. Tony Carroll, executive advisor on the conference, stated that Fernandez was “the first truly high-ranking US government official we’ve had at the Mining Indaba in the 28 years [of its existence].”
Canadian officials, however, are a staple at the Indaba. Last year saw the attendance of Mary Ng, the Trudeau government’s Minister of Small Business, Export Promotion and International Trade, who used her public position to promote the role of the Canadian mining sector in Africa. This year, Ng’s parliamentary secretary Arif Virani travelled to the Indaba (as well as to Zambia) to bolster “Canada’s role as a trusted partner of African companies, industry associations and governments” and to promote, in his words, “responsible business conduct, sustainable mining and inclusive trade.”
The Indaba also featured speeches from Clive Johnson, CEO of B2Gold (one of the largest Canadian miners in West Africa, which drew $630 million from the Fekola gold mine in Mali in 2021), Tristan Pascal of First Quantum (which was recently hit with $8 billion in unpaid import taxes on its Zambian operations), Mark Bristow, CEO of Barrick Gold (one of the most significant gold mining companies in the world), Robert Friedland, billionaire founder of Ivanhoe Mines, and representatives from many of the world’s other leading mining companies.
Putin and the war in Ukraine were referenced overtly in some speeches. When discussing his interest in securing access to South African platinum, Friedland stated “We’re not going to buy it from the Russian Tsar. He’s killing people with his cash flow. Until he stops that kind of behaviour, we will not buy his platinum.” He also made reference to the green transition and stated the need to “develop a lot more mines” on the way to creating sustainable enterprise. In this case and others, the push to expand mineral investments in Africa is dressed up in green, “pro-democratic” language, designed to give the impression that moral rather than material factors are motivating Canadian investment in the continent. The truth, though, is less virtuous: due to the burden of neocolonialism and the imperialistic refashioning of African economies toward an export orientation, Africa is simply the most lucrative place in which to obtain these resource flows.
As the world continues to readjust to uncertain commodity prices and geopolitical rupture resulting from Russia’s invasion of Ukraine, the Canadian mining industry has chosen to double-down on its exploitation of African resources. Canadian companies and their backers in the state would not prioritize this investment unless it continued to serve the essentially neocolonial agenda of the Canadian elite, whose commitment to this global project of unequal development has remained unwavering for decades. While some may believe that increased investment in African minerals will increase standards of living on the continent, it seems more likely that Walter Rodney’s 1972 assertion will prove true once more: while Western industry adapts and develops, the mining that goes on in Africa will leave “[nothing but] holes in the ground.”
Owen Schalk is a writer based in Winnipeg. He is primarily interested in applying theories of imperialism, neocolonialism, and underdevelopment to global capitalism and Canada’s role therein. Visit his website at www.owenschalk.com
The invasion of Ukraine and the resultant Western sanctions against Russia have wrought far-reaching consequences on global commodity flows. These impacts are evident in a number of global shortages, such as the lack of cooking oil in Indonesia and the paucity of fuel in Sri Lanka, the latter of which has been unable to pay for imports since global crude prices soared in early 2022. Food prices are up in the underdeveloped countries of Central Asia, while medical supplies (for which Russia was their largest provider before the onset of Western sanctions) have grown scarcer.
Africa, which imports 85 percent of its wheat (one-third of which comes from Russia and Ukraine), has also felt the strain of the highest food prices in decades. Egypt in particular is scrambling to replace Ukrainian wheat imports, which had previously comprised 80 percent of its stockpile. The Egyptian government had hoped to replace Ukrainian wheat with imports from India, but on May 14, India banned wheat exports, citing the risk of food shortages within its own borders. Thankfully, Cairo has stated that India will honour its previous contract to export 500,000 tonnes of wheat to Egypt, but the future integrity of this arrangement remains unclear, which has led Egypt to seek additional partners in France, Kazakhstan, and Australia.
The price of many important minerals also skyrocketed following the Russian attack. Russia’s economy holds seven percent of the world’s nickel supply, 10 percent of its platinum, 20 percent of its titanium, and 25 percent of its palladium. The price of these metals and others, including aluminum, cobalt, and copper, spiked in March 2022, only to stabilize in the ensuing months, albeit at above-normal prices in many cases.
Some of the most fluctuant minerals are central components of Canada’s $3.8 billion Critical Minerals Strategy, announced by the Trudeau government in 2021 as a way to “capitalize on rising global demand for critical minerals,” to secure inputs for “renewable energy and clean technology applications,” and to guarantee Canada’s economic primacy in the fields of “defence and security technologies, consumer electronics, agriculture, medical applications and critical infrastructure.”
While the Canadian government continues to support the extraction of these minerals domestically, Canada’s mining industry has assumed an increasingly global orientation over the past few decades, especially since the imposition of neoliberal structural adjustment programs (SAPs) on countries across the Global South. Latin America has historically been the most profitable region for Canadian mining companies operating outside North America, but recently, both the Biden and Trudeau governments have spotlighted Africa as an increasingly key supplier for their respective critical minerals strategies.
Steven Fox, executive chairman of New York-based political risk consultancy Veracity Worldwide, has asserted that the Biden administration “wants to position itself as a strong supporter of battery metals projects in sub-Saharan Africa.” These battery metals are an essential component in the creation of electric vehicles and other less fossil fuel-reliant technologies, whose production is described by some as a way of weaning Europe off of Russian energy imports. Additionally, the lack of environmentally appropriate regulations in many African countries, often the result of SAPs and Western advisement on extractive policy, means that mining projects are likelier more efficient—and thus more profitable—to pursue on the continent.
“While Africa presents its challenges,” explained Fox, “those challenges are no more difficult than the corresponding set of challenges in Canada. It may be easier to actually bring a project to fruition in Africa, than in a place like Canada or the US.”
In the context of the Russia-Ukraine war and the increasingly profitable and strategic exploitation of battery metals, Canadian politicians have stressed the need to maintain and expand access to critical minerals on the African continent. In addition to securing a market for Canada’s Critical Minerals Strategy, such access will have the effect of keeping Africa, which has largely sought to remain neutral in the conflict, as a crucial supplier of the minerals with which Canada and its allies hope to blunt the economic blowback of the invasion and of their sanctions programs against Russia.
Canadian capital finances or operates mining projects in over 100 countries, and extraction is growing every year. By 2025, the Mining Global Market Report of 2021 estimates that the global mining and minerals market will reach a value of $2.4 trillion—a compound annual growth rate of seven percent. This growth will be achieved, the report states, with wide-ranging governmental support. “Government policies to support the mining industry [are] expected to drive the mining market,” the report’s summary explains:
Governments are providing subsidies and encouraging foreign direct investments (FDI) in the mining industry. The amount of government support includes the support through governments’ public finance institutions such as bilateral development banks and export credit agencies investing in mining projects, fiscal support through budget allocations and tax exemptions, and investments through majority state-owned mining and utility companies.
Canada is no exception. The Canadian government regularly finances mining operations abroad through its publicly funded state development arms while aggressively lobbying for neoliberal reforms in the countries in which these mines are located. These countries, such as Guatemala, Colombia and Burkina Faso, tend to be underdeveloped states in which the US and its European allies have violently hacked their way into lucrative resource markets, leaving a trail of corpses in their wake.
Prior to the era of structural adjustment, the Canadian government cozied up to brutal right wing states throughout Africa, such as Mobutu Sese Seko in Zaire (between 1985 and 1989, Canada provided his regime with almost $140 million in assistance), apartheid South Africa (Canadian mining companies such as Falconbridge profited from cheap labour in illegally occupied Namibia and elsewhere), and Idi Amin’s Uganda (around one year after Amin announced the expulsion of Uganda’s South Asian population, the Canadian High Commissioner in Nairobi visited Uganda, not to criticize Amin’s policies but to implore him to reverse the nationalization of Toronto-based shoemaking giant Bata Shoes). These policies represented a conscious alignment on the part of the Canadian state with the forces opposed to the left wing pan-Africanist vision of leaders like Ghana’s Kwame Nkrumah and the Democratic Republic of the Congo’s Patrice Lumumba, whose removals were supported by Canadian officials.
In the post-Cold War period, US-led international financial institutions such as the World Bank and the International Monetary Fund were able to impose neoliberal reforms across much of the African continent, allowing Canadian capital to reap the rewards. Canada itself played a notable role in this process; in the case of Tanzania, the Canadian government threatened to withhold aid unless the state accepted an IMF structural adjustment plan, while in South Africa, Canadians were instrumental in pressuring the new ANC government against redistributing the country’s mineral wealth toward its less privileged (in other words, its Black) population.
In the following years, numerous Canadian governments prioritized the negotiation of Foreign Investment Protection Acts (FIPAs) in African countries, legal acts which give corporations the right to sue governments in private tribunals for the “crime” of interfering with their investments. The Harper government negotiated FIPAs with 15 African countries, some of which were signed or announced at mining conventions. Meanwhile, Justin Trudeau announced negotiations for a FIPA with Ethiopia in 2020, and later signed an FIPA with Nigeria.
Former Parliamentary Secretary to the Minister of International Trade Omar Alghabra stated that FIPAs such as these are meant to “encourage increased bilateral investments between our countries by helping to reduce risk and by increasing investor confidence in our respective markets.” His use of the term “bilateral investments” is misleading—these laws are designed to protect the interests of Canadian companies operating in Africa, not vice versa. After all, there are no Malian or Burkinabè mining giants investing billions in Canadian extraction, and Tanzanian companies do not own 50 percent of Canada’s GDP, as Canadian companies do in Zambia.
Over the past few decades, Canadian mining investment abroad has increased considerably, to the degree that foreign mining assets now comprise 70 percent of the total value of all Canadian-owned mining operations—in other words, $188 billion of $273.4 billion. In Africa, the total value of Canadian mining assets is $36.5 billion.
In 2020, 106 Canadian-owned mining companies operated in Africa. Their investments span the continent but are mainly concentrated in a handful of countries. The most treasured countries, each containing Canadian mining assets valued at over $1 billion, are Mali, Mauritania, Burkina Faso, Ghana, the Democratic Republic of the Congo, Tanzania, Zambia, and South Africa. Some other less lucrative but nonetheless important countries, with Canadian assets valued between $100 million and $1 billion, are Senegal, the Ivory Coast, Niger, Namibia, and Botswana. Out of all these countries, Zambia is the most valuable for Canada-based companies, with Canadian-owned assets valued at around $10 billion—approximately half of Zambia’s total GDP, as stated above.
In the most recent edition of Canadian Mining Journal, Bill Kellaway, Colin Rawbone, and John Paul Hunt write that “Global economic recovery and the focus on battery minerals is seeing greater interest in mineral exploration, not least in areas of central and southern Africa.” In this context, Canadian prospectors and geologists are working across Africa, using “the digital revolution” to their advantage by bringing global positioning system (GPS) technology and “powerful modelling software” to regions like the Central African Copperbelt, “allow[ing] historical exploration data to be revisited and more intensively analysed.”
With mineral prices high and Russian commodities largely excised from the investment map, it is no wonder that Canadian companies are seeking profit on a continent that they know will generate significant returns—at the expense of ordinary people in the relevant countries, as always. At the recent Mining Indaba, an annual South Africa-hosted gathering of continental and international figures aimed at promoting the mining sector, Canada’s First Quantum Minerals announced $1.25 billion in new investment in Zambia, whose president Hakainde Hichilema has promised foreign investors that there would be “no mining nationalism” in his country. Barrick Gold has revealed its intention to expand investment talks with Zambia as well.
At the Indaba (which is sponsored by some of the largest mining companies in the world), investments such as these were celebrated under the banner of “energy transition” and “ESG [environmental, social, and governance]” considerations, but it was impossible to ignore the geopolitical context of the event as well. The volatility of global commodity markets in the aftermath of Russia’s invasion of Ukraine, and the need to find less uncertain supply sources for critical minerals, was evident not only in the speeches of government and private officials, but also in the fact that the US sent a high-level delegate to the event for the first time in its history.
That delegate was Jose Fernandez, the US Undersecretary for Economic Growth, Energy, and the Environment, who identified 40 critical minerals on the US shopping list and the Biden administration’s intention to secure them from Africa. Tony Carroll, executive advisor on the conference, stated that Fernandez was “the first truly high-ranking US government official we’ve had at the Mining Indaba in the 28 years [of its existence].”
Canadian officials, however, are a staple at the Indaba. Last year saw the attendance of Mary Ng, the Trudeau government’s Minister of Small Business, Export Promotion and International Trade, who used her public position to promote the role of the Canadian mining sector in Africa. This year, Ng’s parliamentary secretary Arif Virani travelled to the Indaba (as well as to Zambia) to bolster “Canada’s role as a trusted partner of African companies, industry associations and governments” and to promote, in his words, “responsible business conduct, sustainable mining and inclusive trade.”
The Indaba also featured speeches from Clive Johnson, CEO of B2Gold (one of the largest Canadian miners in West Africa, which drew $630 million from the Fekola gold mine in Mali in 2021), Tristan Pascal of First Quantum (which was recently hit with $8 billion in unpaid import taxes on its Zambian operations), Mark Bristow, CEO of Barrick Gold (one of the most significant gold mining companies in the world), Robert Friedland, billionaire founder of Ivanhoe Mines, and representatives from many of the world’s other leading mining companies.
Putin and the war in Ukraine were referenced overtly in some speeches. When discussing his interest in securing access to South African platinum, Friedland stated “We’re not going to buy it from the Russian Tsar. He’s killing people with his cash flow. Until he stops that kind of behaviour, we will not buy his platinum.” He also made reference to the green transition and stated the need to “develop a lot more mines” on the way to creating sustainable enterprise. In this case and others, the push to expand mineral investments in Africa is dressed up in green, “pro-democratic” language, designed to give the impression that moral rather than material factors are motivating Canadian investment in the continent. The truth, though, is less virtuous: due to the burden of neocolonialism and the imperialistic refashioning of African economies toward an export orientation, Africa is simply the most lucrative place in which to obtain these resource flows.
As the world continues to readjust to uncertain commodity prices and geopolitical rupture resulting from Russia’s invasion of Ukraine, the Canadian mining industry has chosen to double-down on its exploitation of African resources. Canadian companies and their backers in the state would not prioritize this investment unless it continued to serve the essentially neocolonial agenda of the Canadian elite, whose commitment to this global project of unequal development has remained unwavering for decades. While some may believe that increased investment in African minerals will increase standards of living on the continent, it seems more likely that Walter Rodney’s 1972 assertion will prove true once more: while Western industry adapts and develops, the mining that goes on in Africa will leave “[nothing but] holes in the ground.”
Owen Schalk is a writer based in Winnipeg. He is primarily interested in applying theories of imperialism, neocolonialism, and underdevelopment to global capitalism and Canada’s role therein. Visit his website at www.owenschalk.com
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