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MODERATOR: All right. Good morning, everyone, to the U.S. Department of State’s Africa Regional Media Hub. I would like to welcome our participants dialing in from across the continent and thank all of you for joining the discussion. Today, we are very pleased to be joined by U.S. Under Secretary of State for Economic Growth, Energy, and Environment Jose W. Fernandez. Under Secretary Fernandez is with us today to discuss U.S. energy policy and priorities and the importance on the African mining sector as it links to the broader international economy. He will also address the progress on the Minerals Security Partnership, or MSP, which is an initiative to bolster critical mineral supply chains. He is speaking to us today from Cape Town, South Africa.
We will begin today’s call with opening remarks from Under Secretary Fernandez, then we will turn to your questions. We will try to get to as many of them as we can during the briefing.
So, as a reminder, today’s call is on the record, and with that, I would like to turn it over to Under Secretary of State for Economic Growth, Energy, and Environment Jose W. Fernandez.
UNDER SECRETARY FERNANDEZ: Good morning, and it’s great to be back here in Cape Town. This is a beautiful city that I always look forward to visiting. And I’m here for a number of reasons. First of all, I just gave a keynote address at Mining Indaba, which is one of Africa’s largest mining investment conferences. And basically, my message was simple: We share the objective together with the partners in the Minerals Security Partnership of investing throughout the supply chain here in Africa on critical minerals, not just extraction. In my talk, that’s really what I wanted them to understand – the whole aspect of the value chain, from extraction to processing to recycling.
And we also want – I also wanted to underscore the fact that our calling card is what I’m calling a race to the top: to adhere to the highest environmental governance standards in – that we could come up with, and we will be publishing those standards, the standards that we will abide by, in the upcoming days and so that people can judge what it is that we are – what our proposition is and that we – what will define success going forward.
So this is a race to the top, because our companies know that they cannot compete in a race to the bottom because shareholders will demand nothing less and because consumers will also insist that we follow those principles.
In addition to that, I will be speaking to a number of colleagues from other countries in Africa. I’ve already met with representatives in Tanzania. I just finished an excellent conversation, wide-ranging conversation with Minister Patel here in South Africa. And there are a number of items that we can talk about that I think define our relations with Africa, from PEPFAR to the Minerals Security Partnership, to what we’re doing on trade and investment, plus our belief that here in South Africa the history of this country in terms of civil rights, in terms of human rights, in terms of its struggle for independence is something that we can all share – and I believe we have a lot in common that I’m hoping to build on during this visit.
So with that, let me turn it back to you, and I look forward to your comments.
MODERATOR: All right. Thank you vert much, Under Secretary Fernandez. We will now begin the question-and-answer portion of today’s briefing. We ask that you limit yourself to one question related to the topic of today’s briefing, which is U.S. energy policy and priorities, the importance of the African mining sector as it links to the broader international economy, and the Minerals Security Partnership. So please be considerate to other journalists and make your questions as brief as possible.
So for our first question we’d like to go to Mr. Emeka Eke of Global Focus Media in Nigeria, who asks: “What is the State Department’s policy towards investing in African mining? Are there select projects identified by Prosper Africa or otherwise?”
UNDER SECRETARY FERNANDEZ: Thank you. Excellent question. Look, our message on African mining is simple. We are at a very propitious moment in our relationship and in the mining sector. There is great demand for critical minerals, for rare earths. If we are going to get to the energy future that we all need to get to, we are going to need to increase the critical minerals anywhere from two to six times what we have today. And in some cases, the growth in the need for those minerals will be much greater – for example, by way of example, lithium; we will need 42 times the amount of lithium that we have today.
We’re just not there yet, and I think this presents an opportunity for African nations to benefit from the need for these minerals. But in order to do that, it’s got to be done responsibly. It means that we’ve got to reach out to communities that – we have to reach out to communities, make sure that communities are consulted and also benefit from the mining, that mines do not create environmental hazards, and that we have the most transparent way of engaging in the mining sector.
So this is both an opportunity and also a risk that we need to avoid, because if we can succeed, not only will – not only will our planet succeed because we will get to the climate energy – to the emissions-free future that we are aiming for, but also there’ll be a benefit for the people here in Africa, for communities everywhere, and for the kind of development that we’re all looking to encourage.
MODERATOR: Thank you very much for that answer. I see that there’s a question here which is a good follow-up, I think, to your opening remarks. So Vicky Stark from VOA asks: “In your opening address this morning, you said that part of the race to the top includes making sure that communities benefit. Can you elaborate on this, please?”
UNDER SECRETARY FERNANDEZ: Sure. Look, in many parts of the world there are projects that have been stymied because communities haven’t been consulted, and communities have been hurt by mining. Oftentimes some mines leave behind environmental damage. Oftentimes you have pollution in the water supply. Oftentimes the benefits simply do not reach the communities. And I’m seeing that all over the world. There are projects in South America that I’m very familiar with that right now would be operating but for the fact that communities have said, “Not here. This is the kind of project that we – this is not the kind of project that we want.”
So the point I was trying to make during the conference is that communities need to be consulted, and they have to become partners and not subjects in the mining industry. And that’s something that we would support, something we encourage, and if done well it will benefit not just communities but will also benefit all of us because we will be able to attain the kind of energy future that we’re all aiming for.
MODERATOR: Okay. I have a related question to that from Thamo Kapisa of SABC Channel Africa in South Africa. Thamo comments that, “Many African presidents have announced plans to reform their country’s mining sector to crack down on rampant, illegal mining and mineral smuggling.” And she mentions also that, “Malawi’s President Chakwera said, if properly regulated, mining could play a major role in Malawi’s economy.” Her question relates to African countries broadly speaking: “What mechanisms has the U.S. Government put in place to assist African countries to achieve these goals” of cracking down on and regulating illegal mining and mineral smuggling?
UNDER SECRETARY FERNANDEZ: So that’s a great question and it’s a topic that I think is important not only for Malawi but for a number of countries on the continent. Small-scale miners and other stakeholders are people we’ve been working with to try to find ways to better protect them, their communities, and the environment from toxic pollution. In Africa, for example right now, as I mentioned in my talk this morning, we are working with the Democratic Republic of the Congo, with Ghana, with Mali to try to find ways to formalize the sector, to introduce ESG standards, and to work to remove toxic chemicals from the extractive process. Oftentimes, small-scale miners simply don’t have the technology to be able to perform what they are trying to do in an environmentally responsible fashion, and we’re working to help on that.
I think there’s also more to be done, and we’re working on this with large and small-scale miners to try to find ways to increase mineral recovery – again, to provide the kinds of technology that small-scale miners need. And I think that if we succeed, not only will the miners benefit but also we will have more environmentally friendly methods that will benefit communities as a whole.
MODERATOR: All right. Thank you. I see another question which was submitted, which is a great follow-up to your last answer, Mr. Under Secretary. So Hannah Northey of E&E News and Politico asks: “Can you please tell us whether the MSP has adopted a suite of ESG standards at the Mining Indaba?”
UNDER SECRETARY FERNANDEZ: So stay tuned. We are discussing in the next couple of days a statement of principles that we have put together with the 13 partners – well, really 12 because Italy just joined us, which is something we’re very happy with. So we’ve put together a statement of principles that we’re taken – that we have – that have not been – have not been principles that have – that we’ve just come up with from nothing. We’ve actually taken a number of the existing standards, standards that are quite acceptable and that are followed in – that are best practices throughout the world from the OECD, from the World Bank, from EITI and from others.
And we put those together into a statement of principles, and Hannah, we will – we will publish them. And the reason why we’re publishing them is important, and it is that I think we need to make sure we all agree, all the partners agree, that we want to make sure that we’re held to those principles. And that’s a standard we will live by. That’s what we mean by a race to the top. It’s what our companies want to do because we’ve concluded that not only is it the right thing to do, but we also know that our companies simply will not win a race to the bottom.
And so stay tuned. In the next couple of days we will have something on that as well.
MODERATOR: All right. Thank you. I’d like to go to a live question now from Peter Fabricius of The Daily Maverick here in South Africa. So, “Under Secretary Fernandez, could you tell us why there are no African members of the MSP? Why in particular South Africa has not joined? Are you urging it to do so, and if so, how is it responding?”
UNDER SECRETARY FERNANDEZ: So we have not – we’re not urging anyone to join. The countries that have wanted to join are countries that we’ve talked to. We – it’s an open framework. It’ll require consensus from all of us. But I think right now, the one thing I will tell you is that there are opportunities even without being members for South Africa and for other countries to work with the MSP. I just finished a conversation with Minister Patel where we talked about the opportunities that exist for investment here in South Africa in the critical minerals sector, not only on extraction but, in fact more importantly, on downstream, on value-added industries that will bring benefits not only on the extractive side but also on the manufacturing side. And that’s something that we intend to do in many, many parts of the world, including in Africa, and I see great opportunities to do that.
MODERATOR: Thank you very much. So Mr. Onishias Maamba from Kwithu FM in Zambia has submitted a couple of questions in advance and also repeated them into the chat. So specifically, “Zambia is currently having a standoff in resolving the issues regarding Mopani and Konkola Copper Mines. How can this impasse be resolved expeditiously?” And similar to that, “Would it be wise for the government to recapitalize the mine in view of other pressing needs that the government has?” And so yeah, with regard to the mining sector in Zambia.
UNDER SECRETARY FERNANDEZ: So I will confess I am not as familiar as – with the situation in these mines. We – there are ways to resolve disputes, and we respect those. So I’m not going to comment on that. What we are trying to do with Zambia, with the DRC, is to work on – and we have; we signed a memorandum of understanding during the Africa Leaders Summit – to work on a project that both countries have agreed to do, which is to build a battery chain – supply chain plant on the border. And we will – we intend to provide technical assistance. We intend to see what we can do to help both of these countries, again, to engage in value-added recycling, value-added processing. And that’s what we intend to do.
But on that internal dispute, I – unfortunately, I need to pass on that one.
MODERATOR: Thank you, Mr. Under Secretary. You mentioned value added, so a related question comes to us from Christian Kasonde of Radio Mano in Zambia. “The main challenge observed in many African countries’ mining sector is that they only depend on unprocessed minerals, which is usually sold at a cheap price. How will you help the small miners to start producing finished products such as copper cables and the like?” Obviously referring to the value chain and value added.
UNDER SECRETARY FERNANDEZ: Yeah. Look, that’s a concern throughout Africa, and it’s something that we believe the Minerals Security Partnership can help alleviate. There are opportunities to do more value-added work here in Africa, and what we need to do is to bring investors into that equation, to work with governments to try and make it easier for those investors to operate, and to do so in a responsible – and I can’t stress this enough – to this in a responsible manner, a manner that will benefit communities, that will benefit the people in those countries.
And so you’re both – you’re right in that right now that’s not a – that’s not as important a business as it should be, but it’s something that we intend to encourage going forward. In fact, I see it as one of our calling cards, and that’s what we believe and that’s why we received such a great reaction from governments throughout Africa for what we’re trying to do. Everyone wants to engage in value-added production, and that’s something that we share and we intend to support that.
MODERATOR: Thank you, Mr. Under Secretary. So I’ve got a couple of questions, if you don’t mind, and I think this is a very topical subject right now about electric vehicles and batteries. So from Darlington Mwendabai in – of the Zambia Daily Mail, there’s a question: “When is America going to establish a battery factory in Zambia?” And another question: “How are you ensuring American investment flows into Zambia, establish ventures for magnesium, which is used in manufacturing car batteries for electric vehicles?” So just a couple of questions, and then I think there was some other broad interest, too, in electric vehicles in general on the continent. So with relation to Zambia and the continent and electric vehicles.
UNDER SECRETARY FERNANDEZ: So look, those are – one comment I would have on the question: it’s not the U.S. establishing a battery factory. It’s something that both the Zambian Government and the DRC Government want to do. This is their idea. And so what we’re trying to do is to facilitate and to do everything we can to make their plans a reality.
We intend to do that through technical assistance. We have signed a memorandum of understanding to help both countries. And I’ll be having conversations here in Cape Town with the governments of both countries to see how we can help. But it’s their project, it’s their idea, and what we want to do is to help these countries achieve something that they have themselves decided they want to do. Because again, there are benefits to be brought to – in the downstream sector, in the processing sector, but there’s also dangers. And so what we would like to do is to find ways to minimize those risks while maximizing the benefits to those countries.
MODERATOR: All right. So the Under Secretary has been very generous with his time with us this morning. We’ve got time for just one more question, and I see a question here in the chat from Clara Marques: “How do you plan to ensure this welcome commitment to Africa fits with U.S. efforts to encourage more extraction and processing of critical and strategic minerals within its own borders and those of FTA nations, free trade agreement nations?” Thank you.
UNDER SECRETARY FERNANDEZ: Sure. That’s a great question. And basically there’s a simple answer: all of the above. What we’re trying to do outside of the U.S. is complementary to what we want to do within the U.S. We need – again, we need 42 times the amount of lithium than we use today. That’s going to come from a number of countries. And what we’re trying to do is to make sure that we do not leave any stone unturned, to use a bad metaphor.
MODERATOR: I love that metaphor. (Laughter.) Okay. So we had a great set of questions and, Under Secretary Fernandez, you gave a great set of answers on a variety of topics. Do you have any final thoughts or final words for us this morning?
UNDER SECRETARY FERNANDEZ: Well, first of all, thank you for the questions. We very much welcome your interest. Look, what we are looking to do here as well as elsewhere with the Minerals Security Partnership is look for ways to both benefit African countries from natural resources to take advantage of a very special moment – a moment that we need to take advantage of now, which is that the world needs additional critical minerals. But we need to do that in a different fashion. We need to do that in a way that benefits communities. And if we can do that, then we will both benefit as a planet but we will also benefit locally, and that’s what we intend to do. And 2023, this year, will be the year that we test that proposition – the proposition that we can do so responsibly while at the same time achieving our critical mineral goals.
MODERATOR: All right, so thank you very much. That concludes today’s briefing. I want to thank Jose Fernandez, U.S. Under Secretary of State for Economic Growth, Energy, and Environment, for joining us, and thank all the journalists for participating. If you have any questions about today’s briefing, you may contact the Africa Regional Media Hub at AFMediaHub@state.gov. You will be receiving a transcript of today’s session. And I would also invite you to follow us on Twitter @AfricaMediaHub and also use the #AFHubPress with any comments or postings on Twitter.
So thanks once again to the Under Secretary and to all the journalists, and I wish you a productive conference and a great day. Thank you very much.
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