• FINANCE
The Kingdom is increasingly looking to Africa as a source of critical minerals and metals , and its investments are likely to grow in the coming years .
It is important to note that some of these projects are still in the early stages of development , and it is not certain whether they will all go ahead . However , Saudi Arabia ' s growing interest in African mining is a sign of the continent ' s increasing importance as a source of mineral resources .
Apart from mining , the KSA has also starting investing and getting in volved in African infrastructure and energy projects . Investing in renewable energy projects is one of the major areas , where Saudi Arabia is supporting solar , wind and geothermal projects across Africa , contributing to clean energy development and diversifying the continent ' s energy mix .
Further , Saudi Arabia is involved in building critical infrastructure like roads , ports and railways , facilitating trade and economic growth across Africa . This is evident in projects like the Lamu Port in Kenya and the Mombasa-Nairobi Expressway . Saudi Arabia is also collaborating with the African Development Bank to improve electricity access in Africa through regional power grid interconnection projects .
Due to the near full current dependency of KSA of food imports , the country has involved itself in African-based projects that will secure agriculture and food security and is partnering with African nations to improve agricultural productivity and food security . This includes initiatives like providing financing for irrigation systems , promoting sustainable farming practices and supporting agribusinesses . In addition , the Kingdom provides substantial food aid to vulnerable African populations , addressing food insecurity and humanitarian needs .
Saudi Arabia ' s King Salman Humanitarian Aid and Relief Center ( KSrelief ) provides vital healthcare assistance in conflict zones and areas affected by natural disasters across Africa . The Kingdom is also investing in educational initiatives , like building schools and universities , and offering scholarships to African students . This aims to foster human capital development and empower future generations .
Saudi Arabia is increasing its trade ties with African nations , promoting bilateral trade agreements and supporting the development of Africa ' s free trade zones . The Kingdom is also offering financial assistance and credit lines , enabling African countries to invest in infrastructure projects and boost their economic development .
Actively engaging with African nations at the diplomatic level , Saudi Arabia is strengthening bilateral relations and building political partnerships . This includes high-level visits , joint ministerial meetings and participation in regional forums .
Over the last two decades , China has been the largest investor and operator of mining projects in Africa . The potential is that the Kingdom will start to ingress on this sphere of influence . There are some key differences in the mining investment strategies of Saudi Arabia and China in Africa .
The main focus of Saudi Arabia has been primarily targeting critical minerals ( e . g ., lithium , cobalt and nickel ) needed for their economic diversification and high-tech industries , driven by Vision 2030 .
Additionally , it is investing in coal for domestic energy needs . In contrast , China has a broader focus on securing a wide range of minerals and metals , including bulk commodities ( e . g ., iron ore and copper ) essential for their booming manufacturing sector and infrastructure development .
The difference in approach is also notable . Saudi Arabia has placed more emphasis on strategic partnerships with African governments and established mining companies , often through their Public Investment Fund ( PIF ), focused on building long-term , mutually beneficial relationships . The approach of China has been more often to employ state-owned companies for direct investments and acquisitions , offering infrastructure upgrades and loans in exchange for mineral rights . This can be seen as more assertive and potentially exploitative by some African nations .
Important is also the scale and scope of involvement . To date , Saudi Arabia has been a relatively newcomer to large-scale African mining , with investments being generally smaller and more targeted , focusing on specific projects or partnerships . In turn , China is considered to be established as the dominant player in African mining for over two decades . Large-scale investments across multiple countries and diverse minerals .
Where development and sustainability of the mining projects are considered , Saudi Arabia has placed emphasis on sustainable mining practices and local skills development in their partnerships . Vision 2030 includes goals for environmental protection and community engagement . Historically China was criticised for prioritising resource extraction over environmental and social concerns in Africa . However , recent initiatives suggest they are taking steps to improve their social and environmental impact .
The Kingdom of Saudi Arabia has been taking a more cautious , strategic approach focused on securing critical minerals and building partnerships , prioritising sustainability and responsible resource management , whereas China is maintaining their more aggressive and expansive investments , driven by their massive internal demand , resulting in them facing increasing scrutiny over environmental and social impacts .
The Kingdom of Saudi Arabia has the potential to become the next major foreign player in Africa . It is expected that more companies will start looking to the KSA for investment , rather than China in the near future . •
The Kingdom of Saudi Arabia has been taking a more cautious , strategic approach focused on securing critical minerals and building partnerships , prioritising sustainability and responsible resource management .
32 • African Mining • March 2024 www . africanmining . co . za