Copyright ghanamma
Rwandan mineral exporters are upbeat that the tax exemption announced by the US earlier in September on exports of minerals such as tungsten and gold, eyeing increased revenues due to the policy, even as experts warn that the move will be detrimental to Africa’s growth. In a policy seen as motivated by the need to stock up critical minerals that the US needs, President Donald Trump’s administration has exempted gold, tungsten, uranium, and graphite from global tariffs. The Trump administration said the exemption is “necessary and appropriate” to address a “national emergency” cited when the tariffs were first imposed. China’s restriction on the export of rare earth minerals created supply-chain disruptions, increased costs, and delays for the US automotive and defence industries, which heavily relied on Chinese processing. Innocent Kagenga, chair of the Rwanda Mining Association, termed the development positive, noting that it would definitely increase prices. “We export gold, and we have the Gasabo Gold Refinery. Having a tax-exempt market at this time will positively impact our exports. We have been buying gold at good prices, and we export refined gold, attracting a higher price,” said Kagenga. Gasabo was put under European Union sanctions in March, amid the takeover of some eastern Congo territory by the AFC/M23 rebels. Experts say waiving taxes on minerals from Africa seems to be one of the ways the US is remedying the problem of relying on China. The Trump White House stated the move is essential for securing supplies vital to American economic security. In addition to precious metals, uranium, tungsten, and graphite are strategic inputs for the aerospace, electronics, medical device, and energy sectors. Analysts critical of Africa’s continued export of its minerals to the West have, however, warned that this is a ploy by the US to stockpile critical minerals it needs to power its growth, and selling off the continent’s minerals to the West might one day lead to depletion of the resources it needs for its energy resources and industrialisation. “Africa’s strategic minerals must first serve Africa’s own energy transition and industrialisation. The illusion of abundance is simply because we are not industrialising fast enough, and 800 million Africans are trapped in energy poverty,” said renowned economist Dr Donald Kaberuka, who is the African Union High Representative for the Peace Fund. He said a time will come when African countries will have to import, at a much higher price, the very minerals they are now exporting — leaving the continent with no choice but to spend heavily, as those minerals will be needed for its development. Uranium is one of those minerals economists say African countries will regret exporting. Used in the production of nuclear energy, uranium is seen as the shortcut to Africa overcoming its energy poverty. Yet African countries continue to export it to the US, Russia, and other Western countries, some of which are stockpiling it for use in the future. Niger, Namibia, and South Africa make up 20 percent of the global uranium deposits, but all these countries export their uranium ores. Niger, the world’s seventh-largest producer, exported uranium worth $204 million to France in 2023, a 51 percent increase from what it exported in 2022. When asked if the unregulated export of critical minerals would not lead to depletion, Kagenga said, “We can’t say that they can be depleted in the coming years; for now, the focus is on exporting, as we wait for the industries. We will continue to mine and export until the time comes when our industrialisation is much developed.”
