Africa Finance Corporation Plans Exploration Fund to Unlock Mineral Reserves

Africa Finance Corporation (AFC) plans to launch an investment company dedicated to mineral exploration within the next 12 months, seeking to address a funding gap that has limited the discovery and development of Africa’s mineral reserves.

Franklin Edochie, AFC’s deputy director and head of its metals and mining desk, announced the plan at African Mining Week in Cape Town on Wednesday, saying the vehicle would help expand mineral reserves, increase domestic production and strengthen African countries’ control over their resources.

“Investing in exploration is one of our primary targets because local value-addition strategies depend on discovering and defining new reserves,” Edochie said.

He said insufficient investment in exploration could leave African countries with less influence over how their mineral resources are developed, particularly as global geopolitical competition shapes investment decisions. A dedicated investment vehicle would help direct capital towards minerals considered important to the continent’s long-term economic development, he added.

AFC is also seeking to expand investment in infrastructure serving mining and industrial centres, including regional ports and electricity corridors. Edochie cited the Copperbelt, a major mining region spanning parts of the Democratic Republic of Congo (DRC) and Zambia, as an area where reliable power infrastructure is essential to industrial activity.

The proposed investment company comes as African countries seek to develop a clearer picture of their mineral potential and attract investment into exploration, an early stage of mining that requires substantial funding before commercially viable deposits can be established.

In the DRC, national geological mapping efforts are intended to improve information available to prospective investors. Freddy Mwamba Kanyinku, director-general of the country’s Centre d’Expertise, d’Evaluation et de Certification (CEEC), said high-precision geological mapping had covered 19 percent of the country’s territory.

Kanyinku said modernising geological assessment was changing how foreign investors could access information about the country’s mineral resources.

“Previously, to invest in the DRC, you had to go through Belgium first. That is no longer the case — investors can now come directly to us,” he said.

He added that the country was procuring advanced surveying equipment to improve the assessment of its mineral resources. Kanyinku estimated that 80 percent of the DRC’s territory remained unexplored, presenting potential opportunities for further exploration and investment.

The DRC has established partnerships with countries including the United States, he said, while encouraging further international investment in its geological mapping and mineral exploration efforts.

Source: FSX Business News