The continent’s share of global exploration spending fell from 16.6% in 2012 to 10.4% in 2024 – BDO.
Despite being endowed with some of the world’s richest deposits of critical minerals, Africa’s mining sector is experiencing a sustained decline in mineral exploration, a trend that could weigh on its future project pipeline over time.
BDO’s Annual Mining Report 2026 notes that Africa is simultaneously trying to reposition itself from a predominantly raw-materials supplier to a higher-value mining and processing hub, using measures such as export controls, local processing requirements and strategic partnerships.
This ambition, however, is being constrained by declining exploration investment, in addition to familiar regional challenges such as policy uncertainty, inadequate infrastructure and energy bottlenecks.
The findings were presented on the sidelines of this year’s Mining Indaba in Cape Town, where discussions were dominated by the increasing strategic importance of critical minerals.
Exploration dropping
The report shows that Africa’s share of global exploration spending has continued to fall, declining from 16.6% in 2012 to just 10.4% in 2024, equivalent to about $1.3 billion (R20.6 billion*) in exploration spend.
The drop in exploration is most evident at the grassroots level, where investment has fallen by 13.2 percentage points, showing a reduced appetite for early-stage risk and innovation.
For South Africa, the trend is particularly concerning.
According to the Minerals Council of South Africa, the country attracts less than 1% of global exploration spending, placing it well behind jurisdictions such as Canada and Australia, despite its established mining industry and resource base.
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Unpacking the report at a media roundtable on Wednesday, BDO partners warned that the slowdown in exploration across Africa could ultimately mean not enough bankable projects at a time when global demand for critical minerals is accelerating.
Even though Africa’s geological endowment remains significant, accessing it is becoming more complex and capital-intensive.
“The endowment is there, but it’s harder to get to,” Matt Crane, head of natural resources and audit partner, says.
“However, there is new technology and better, more efficient ways of mining and predictive drilling to know what your reserves look like.”
Despite these advances, capital remains cautious. Geopolitical risk continues to weigh heavily on investment decisions. “At the moment, a lot of capital is tied up. It’s challenging to get it over the line, especially since you have geopolitical challenges on the continent,” Crane adds.
Tanzania and Zimbabwe
Policy inconsistency and fiscal instability are also cited as key constraints.
Bert Lopes, partner in business services outsourcing and global mining lead at BDO, points to Tanzania as an example where recent developments in the mining sector have unnerved investors.
Regulatory and policy changes, including evolving local-ownership and beneficiation requirements, as well as broader amendments to mining legislation, have affected fiscal terms and investor rights.
“For example, Tanzania recently … and Zimbabwe. There’s inconsistent messaging across Africa,” Lopes says.
In November 2025, the Zimbabwean government initially proposed doubling its gold mining royalty from 5% to 10% once prices exceeded about $2 500 an ounce. This would have immediately affected most producers, given current gold prices.
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Following industry pushback and parliamentary debate, the policy was revised. The 10% royalty will now apply only if gold prices exceed $5 000 an ounce, with the 5% rate remaining in place below that level.
“[Something like] that is the difference between a bankable project, or not. That stops a project,” Lopes says.
He adds that frequent policy shifts make long-term planning difficult. “It’s difficult to take a long view around so much inconsistency.”
‘Knee-jerk reaction’
These concerns are surfacing at a time when several commodities are trading at elevated levels. Gold prices rose sharply during 2025, while copper and silver have also remained strong, supported by the energy transition, electrification and geopolitical uncertainty.
“With some minerals at record high prices – gold, silver and copper – there’s a knee-jerk reaction sometimes from African countries – for political reasons – not necessarily for the good of the population,” Lopes says.
The BDO partners argue that stability, rather than opportunistic intervention, is critical to investment.
“If you have changes and swings in fiscal policies, it makes it very difficult for somebody to invest in most of these projects,” Crane says.
Besides exploration, the report also notes that global mining industry is being reshaped by rising demand for critical minerals and greater government involvement.
Copper, lithium, nickel, cobalt and rare earth elements are increasingly central to energy transition technologies, electric vehicles, defence systems and data centres, although supply responses have been uneven.
Rapid capacity expansion has created oversupply and price pressure in lithium and nickel, while export controls and regulatory intervention have tightened markets such as cobalt.
Gold, meanwhile, has reasserted its role as a safe-haven asset, with prices ending 2025 about 65% higher, supported by central-bank buying, geopolitical tensions and renewed investor interest.
“Africa sits at the heart of the global mining narrative … [with] significant reserves of cobalt, manganese, platinum group metals and other energy-transition minerals,” the report notes.
Interrogate beneficiation
In 2025, the continent adopted the African Green Minerals Strategy, signalling a clear intent to capture more value through beneficiation. “Realising this potential, however, will require decisive action,” BDO says.
Thuto Masasa, head of advisory at BDO, argues that beneficiation should be approached at a regional rather than purely national level. “Africa should integrate – you cannot beneficiate everything in one country,” she says.
Lopes notes that logistics and basic infrastructure remain binding constraints.
“We lost out because of logistics,” he says, referring to South Africa’s rail and port constraints at Transnet, which curtailed mineral exports during a period of strong commodity prices.
“Let’s focus on fixing that first, and then focus on beneficiation,” Lopes adds. “It’s a lot of talk at the moment, but we need to get the basics right, first.”
*$1 = R15.87
This article was republished from Moneyweb. Read the original here.
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