Geoeconomics of Decarbonization: Climate-Resilient Developmental Regionalism and the AfCFTA

This policy brief examines the global race to secure critical minerals for green and digital industrial revolutions, detailing the strategies of the US, EU, UK, Canada, and China. It argues that African countries can leverage their mineral wealth through the African Continental Free Trade Area (AfCFTA) by adopting a 'climate-resilient developmental regionalism' approach to build regional value chains and achieve sustainable structural transformation.

• The United States employs a long-term strategy to reduce foreign dependencies on critical minerals, utilizing the 'Bidenomics Bills'—the 2021 Infrastructure, Investment and Jobs Act, the 2022 Inflation Reduction Act (IRA), and the 2022 CHIPS and Science Act—to drive its green industrial revolution. The IRA specifically focuses on domestic production and investment subsidies, including USD 7,500 subsidies for US-made electrical vehicles that exclude Chinese-made components.
• The European Union has responded to US subsidies with the Green Deal Industrial Plan, allocating approximately EUR 510 billion (USD 550 billion) to sectors like clean hydrogen, energy storage, wind, and solar. To further retain clean tech investments and match US subsidies, the EU adopted the Temporary Crisis and Transition Framework (TCTF) in March 2023, providing tax credits and public support in strategic sectors.
• The United Kingdom's 2022 Critical Mineral Strategy prioritizes minerals for electric car batteries (lithium, cobalt, graphite), electronics (silicon, tin), and wind turbines (rare earth elements). The UK is investing up to GBP 850 million in R&D and industrialization for a zero-emission vehicle supply chain, with an additional GBP 22 billion in financing capacity via the government-owned UK Infrastructure Bank (UKIB).
• Canada's critical minerals strategy focuses on fast-tracking mining approvals for lithium, copper, cobalt, rare earth elements (REEs), graphite, and nickel. In 2022, the government allocated CAD 3.8 billion in federal funding for critical mineral projects, while the 2019 Mines to Mobility initiative has attracted over CAD 7 billion in investment to build a domestic battery innovation ecosystem.
• China is a dominant global force in critical minerals and battery production, acting as the largest producer for 12 of 18 identified critical minerals and controlling approximately 75% of lithium-ion battery production. In Africa, Chinese companies control about 30% of copper production and up to 50% of cobalt production, with a strong presence in the Democratic Republic of Congo and Zambia.
• The author proposes 'climate-resilient developmental regionalism' as a framework for the AfCFTA to help African countries transition to a low-carbon economy. This approach integrates climate resilience across four pillars: democratic governance, cross-border infrastructure development cooperation, building regional industrial value chains, and the principle of special and differential treatment.

APA

Ismail, F. (2024). Geoeconomics of Decarbonization: Climate-Resilient Developmental Regionalism and the AfCFTA. Africa Policy Research Institute. https://afripoli.org/geoeconomics-of-decarbonization-climate-resilient-developmental-regionalism-and-the-afcfta

Chicago

Ismail, Faizel. Geoeconomics of Decarbonization: Climate-Resilient Developmental Regionalism and the AfCFTA. Africa Policy Research Institute, 2024. https://afripoli.org/geoeconomics-of-decarbonization-climate-resilient-developmental-regionalism-and-the-afcfta.

Wikipedia

{{cite report |last1=Ismail |first1=Faizel |title=Geoeconomics of Decarbonization: Climate-Resilient Developmental Regionalism and the AfCFTA |publisher=Africa Policy Research Institute |date=4 September 2024 |url=https://afripoli.org/geoeconomics-of-decarbonization-climate-resilient-developmental-regionalism-and-the-afcfta |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{ismail2024geoeconomics, author = {Ismail, Faizel}, title = {{Geoeconomics of Decarbonization: Climate-Resilient Developmental Regionalism and the AfCFTA}}, institution = {Africa Policy Research Institute}, year = {2024}, month = sep, url = {https://afripoli.org/geoeconomics-of-decarbonization-climate-resilient-developmental-regionalism-and-the-afcfta}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }