The struggle in Ukraine has Canadian mining corporations trying to Africa

The struggle in Ukraine

The invasion of Ukraine and the resultant Western sanctions in opposition to Russia have wrought far-reaching penalties on international commodity flows. These impacts are evident in various international shortages, such because the lack of cooking oil in Indonesia and the paucity of gasoline in Sri Lanka, the latter of which has been unable to pay for imports since international crude costs soared in early 2022. Meals costs are up within the underdeveloped international locations of Central Asia, whereas medical provides (for which Russia was their largest supplier earlier than the onset of Western sanctions) have grown scarcer.

Africa, which imports 85 % of its wheat (one-third of which comes from Russia and Ukraine), has additionally felt the pressure of the very best meals costs in many years. Egypt particularly is scrambling to interchange Ukrainian wheat imports, which had beforehand comprised 80 % of its stockpile. The Egyptian authorities had hoped to interchange Ukrainian wheat with imports from India, however on Might 14, India banned wheat exports, citing the chance of meals shortages inside its personal borders. Fortunately, Cairo has said that India will honour its earlier contract to export 500,000 tonnes of wheat to Egypt, however the future integrity of this association stays unclear, which has led Egypt to search extra companions in France, Kazakhstan, and Australia.

The value of many necessary minerals additionally skyrocketed following the Russian assault. Russia’s financial system holds seven % of the world’s nickel provide, 10 % of its platinum, 20 % of its titanium, and 25 % of its palladium. The value of those metals and others, together with aluminum, cobalt, and copper, spiked in March 2022, solely to stabilize within the ensuing months, albeit at above-normal costs in lots of circumstances.

Among the most fluctuant minerals are central elements of Canada’s $3.8 billion Essential Minerals Technique, introduced by the Trudeau authorities in 2021 as a option to “capitalize on rising international demand for important minerals,” to safe inputs for “renewable power and clear know-how purposes,” and to ensure Canada’s financial primacy within the fields of “defence and safety applied sciences, shopper electronics, agriculture, medical purposes and demanding infrastructure.”

Whereas the Canadian authorities continues to assist the extraction of those minerals domestically, Canada’s mining trade has assumed an more and more international orientation over the previous few many years, particularly because the imposition of neoliberal structural adjustment packages (SAPs) on international locations throughout the International South. Latin America has traditionally been probably the most worthwhile area for Canadian mining corporations working outdoors North America, however lately, each the Biden and Trudeau governments have spotlighted Africa as an more and more key provider for his or her respective important minerals methods.

Steven Fox, government chairman of New York-based political danger consultancy Veracity Worldwide, has asserted that the Biden administration “desires to place itself as a powerful supporter of battery metals tasks in sub-Saharan Africa.” These battery metals are a vital part within the creation of electrical automobiles and different much less fossil fuel-reliant applied sciences, whose manufacturing is described by some as a means of weaning Europe off of Russian power imports. Moreover, the dearth of environmentally applicable laws in lots of African international locations, usually the results of SAPs and Western advisement on extractive coverage, implies that mining tasks are likelier extra environment friendly—and thus extra worthwhile—to pursue on the continent.

“Whereas Africa presents its challenges,” defined Fox, “these challenges aren’t any harder than the corresponding set of challenges in Canada. It could be simpler to truly carry a mission to fruition in Africa, than in a spot like Canada or the US.”
Within the context of the Russia-Ukraine struggle and the more and more worthwhile and strategic exploitation of battery metals, Canadian politicians have pressured the necessity to keep and develop entry to important minerals on the African continent. Along with securing a marketplace for Canada’s Essential Minerals Technique, such entry may have the impact of protecting Africa, which has largely sought to stay impartial within the battle, as an important provider of the minerals with which Canada and its allies hope to blunt the financial blowback of the invasion and of their sanctions packages in opposition to Russia.

Canadian capital funds or operates mining tasks in over 100 international locations, and extraction is rising yearly. By 2025, the Mining International Market Report of 2021 estimates that the worldwide mining and minerals market will attain a worth of $2.4 trillion—a compound annual progress fee of seven %. This progress might be achieved, the report states, with wide-ranging governmental assist. “Authorities insurance policies to assist the mining trade [are] anticipated to drive the mining market,” the report’s abstract explains:

Canada isn’t any exception. The Canadian authorities commonly funds mining operations overseas by way of its publicly funded state improvement arms whereas aggressively lobbying for neoliberal reforms within the international locations through which these mines are situated. These international locations, resembling Guatemala, Colombia and Burkina Faso, are usually underdeveloped states through which the US and its European allies have violently hacked their means into profitable useful resource markets, leaving a path of corpses of their wake.

Previous to the period of structural adjustment, the Canadian authorities cozied as much as brutal right-wing states all through Africa, resembling Mobutu Sese Seko in Zaire (between 1985 and 1989, Canada supplied his regime with virtually $140 million in help), apartheid South Africa (Canadian mining corporations resembling Falconbridge profited from low-cost labour in illegally occupied Namibia and elsewhere), and Idi Amin’s Uganda (round one yr after Amin introduced the expulsion of Uganda’s South Asian inhabitants, the Canadian Excessive Commissioner in Nairobi visited Uganda, to not criticize Amin’s insurance policies however to implore him to reverse the nationalization of Toronto-based shoemaking big Bata Footwear).

These insurance policies represented a acutely aware alignment on the a part of the Canadian state with the forces against the left-wing pan-Africanist imaginative and prescient of leaders like Ghana’s Kwame Nkrumah and the Democratic Republic of the Congo’s Patrice Lumumba, whose removals had been supported by Canadian officers.

Within the post-Chilly Battle interval, US-led worldwide monetary establishments such because the World Financial institution and the Worldwide Financial Fund had been in a position to impose neoliberal reforms throughout a lot of the African continent, permitting Canadian capital to reap the rewards. Canada itself performed a notable position on this course of; within the case of Tanzania, the Canadian authorities threatened to withhold help except the state accepted an IMF structural adjustment plan, whereas in South Africa, Canadians had been instrumental in pressuring the brand new ANC authorities in opposition to redistributing the nation’s mineral wealth towards its much less privileged (in different phrases, its Black) inhabitants.

Within the following years, quite a few Canadian governments prioritized the negotiation of International Funding Safety Acts (FIPAs) in African international locations, authorized acts which give firms the appropriate to sue governments in non-public tribunals for the “crime” of interfering with their investments. The Harper authorities negotiated FIPAs with 15 African international locations, a few of which had been signed or introduced at mining conventions. In the meantime, Justin Trudeau introduced negotiations for a FIPA with Ethiopia in 2020, and later signed an FIPA with Nigeria.

Former Parliamentary Secretary to the Minister of Worldwide Commerce Omar Alghabra said that FIPAs resembling these are supposed to “encourage elevated bilateral investments between our international locations by serving to to scale back danger and by growing investor confidence in our respective markets.” His use of the time period “bilateral investments” is deceptive—these legal guidelines are designed to guard the pursuits of Canadian corporations working in Africa, not vice versa. In any case, there aren’t any Malian or Burkinabè mining giants investing billions in Canadian extraction, and Tanzanian corporations don’t personal 50 % of Canada’s GDP, as Canadian corporations do in Zambia.

Over the previous few many years, Canadian mining funding overseas has elevated significantly, to the diploma that international mining property now comprise 70 % of the entire worth of all Canadian-owned mining operations—in different phrases, $188 billion of $273.4 billion. In Africa, the entire worth of Canadian mining property is $36.5 billion.

In 2020, 106 Canadian-owned mining corporations operated in Africa. Their investments span the continent however are primarily concentrated in a handful of nations. Probably the most treasured international locations, every containing Canadian mining property valued at over $1 billion, are Mali, Mauritania, Burkina Faso, Ghana, the Democratic Republic of the Congo, Tanzania, Zambia, and South Africa. Another much less profitable however nonetheless necessary international locations, with Canadian property valued between $100 million and $1 billion, are Senegal, the Ivory Coast, Niger, Namibia, and Botswana. Out of all these international locations, Zambia is probably the most beneficial for Canada-based corporations, with Canadian-owned property valued at round $10 billion—roughly half of Zambia’s complete GDP, as said above.

In the latest version of Canadian Mining Journal, Invoice Kellaway, Colin Rawbone, and John Paul Hunt write that “International financial restoration and the deal with battery minerals is seeing larger curiosity in mineral exploration, not least in areas of central and southern Africa.” On this context, Canadian prospectors and geologists are working throughout Africa, utilizing “the digital revolution” to their benefit by bringing international positioning system (GPS) know-how and “highly effective modelling software program” to areas just like the Central African Copperbelt, “enable[ing] historic exploration knowledge to be revisited and extra intensively analysed.”

With mineral costs excessive and Russian commodities largely excised from the funding map, it’s no surprise that Canadian corporations are searching for revenue on a continent that they know will generate important returns—on the expense of peculiar individuals within the related international locations, as all the time. On the latest Mining Indaba, an annual South Africa-hosted gathering of continental and worldwide figures geared toward selling the mining sector, Canada’s First Quantum Minerals introduced $1.25 billion in new funding in Zambia, whose president Hakainde Hichilema has promised international traders that there could be “no mining nationalism” in his nation. Barrick Gold has revealed its intention to develop funding talks with Zambia as properly.

On the Indaba (which is sponsored by a few of the largest mining corporations on the earth), investments resembling these had been celebrated underneath the banner of “power transition” and “ESG [environmental, social, and governance]” concerns, nevertheless it was unimaginable to disregard the geopolitical context of the occasion as properly. The volatility of world commodity markets within the aftermath of Russia’s invasion of Ukraine, and the necessity to discover much less unsure provide sources for important minerals, was evident not solely within the speeches of presidency and personal officers, but in addition in the truth that the US despatched a high-level delegate to the occasion for the primary time in its historical past.

That delegate was Jose Fernandez, the US Undersecretary for Financial Development, Power, and the Atmosphere, who recognized 40 important minerals on the US purchasing record and the Biden administration’s intention to safe them from Africa. Tony Carroll, government advisor on the convention, said that Fernandez was “the primary really high-ranking US authorities official we’ve had on the Mining Indaba within the 28 years [of its existence].”

Canadian officers, nonetheless, are a staple on the Indaba. Final yr noticed the attendance of Mary Ng, the Trudeau authorities’s Minister of Small Enterprise, Export Promotion and Worldwide Commerce, who used her public place to advertise the position of the Canadian mining sector in Africa. This yr, Ng’s parliamentary secretary Arif Virani travelled to the Indaba (in addition to to Zambia) to bolster “Canada’s position as a trusted associate of African corporations, trade associations and governments” and to advertise, in his phrases, “accountable enterprise conduct, sustainable mining and inclusive commerce.”

The Indaba additionally featured speeches from Clive Johnson, CEO of B2Gold (one of many largest Canadian miners in West Africa, which drew $630 million from the Fekola gold mine in Mali in 2021), Tristan Pascal of First Quantum (which was lately hit with $8 billion in unpaid import taxes on its Zambian operations), Mark Bristow, CEO of Barrick Gold (one of the important gold mining corporations on the earth), Robert Friedland, billionaire founding father of Ivanhoe Mines, and representatives from most of the world’s different main mining corporations.

Putin and the struggle in Ukraine had been referenced overtly in some speeches. When discussing his curiosity in securing entry to South African platinum, Friedland said “We’re not going to purchase it from the Russian Tsar. He’s killing individuals together with his money circulate. Till he stops that type of behaviour, we is not going to purchase his platinum.” He additionally made reference to the inexperienced transition and said the necessity to “develop much more mines” on the best way to creating sustainable enterprise.

On this case and others, the push to develop mineral investments in Africa is dressed up in inexperienced, “pro-democratic” language, designed to provide the impression that ethical moderately than materials components are motivating Canadian funding within the continent. The reality, although, is much less virtuous: because of the burden of neocolonialism and the imperialistic refashioning of African economies towards an export orientation, Africa is solely probably the most profitable place through which to acquire these useful resource flows.

Because the world continues to readjust to unsure commodity costs and geopolitical rupture ensuing from Russia’s invasion of Ukraine, the Canadian mining trade has chosen to double-down on its exploitation of African sources. Canadian corporations and their backers within the state wouldn’t prioritize this funding except it continued to serve the primarily neocolonial agenda of the Canadian elite, whose dedication to this international mission of unequal improvement has remained unwavering for many years. Whereas some could imagine that elevated funding in African minerals will enhance requirements of dwelling on the continent, it appears extra seemingly that Walter Rodney’s 1972 assertion will show true as soon as extra: whereas Western trade adapts and develops, the mining that goes on in Africa will depart “[nothing but] holes within the floor.”

Owen Schalk is a author based mostly in Winnipeg. He’s primarily taken with making use of theories of imperialism, neocolonialism, and underdevelopment to international capitalism and Canada’s position therein. Go to his web site at
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