How Critical Minerals are Powering the Next Frontier of the Global Economy

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Critical minerals, such as copper, cobalt, lithium and other rare earth elements, have come to play a central role in competitiveness strategies as the global push for clean energy and decarbonization drives societies to new economic models.

C. Derek Campbell, a retired Colonel in the U.S. Marines and a GFCC Distinguished Fellow, provided an overview of the global state of play for critical minerals, highlighting the main challenges and opportunities in the sector, the geopolitical impacts of the global rush to access minerals, and avenues for investments at July's GFCC Monthly Call.

Mr. Campbell is the Executive Chairman of LVC Global Holdings—a natural resource asset acquisition platform operating across Africa and the Middle East— and holds extensive experience in natural resource optimization and monetization in frontier markets, particularly in Africa.

He pointed out that the rush for critical minerals has implications across multiple sectors, including national security, technology development and transfer, resource beneficiation, mineral monetization, and more.

“We are soon approaching a time when all geopolitics and socio-economics are going to be driven by what we are pulling out of the ground,” argues Mr. Campbell.

But even if critical minerals have come to the headlines and become national priorities for multiple countries, capital markets hesitate to fully invest in extraction operations. One of the key reasons is the high environmental risks involved, such as deforestation, water pollution, and habitat destruction, as well as the socio-economic impacts on local communities.

On top of that, the geographic distance between resource extraction areas and global financial capitals—such as Singapore, London, New York, D.C., and Miami—and the need for brokers and intermediaries to reach deals is another complicating factor.

Additionally, the costs of investing in the mining sector are extremely high. According to the Commodity Trading Club, only 1 in every 200 mine discoveries turns out to become operational, and at least 20% of those mines never repay investors.

For Mr. Campbell, the way forward is harnessing win-win solutions through global partnerships, working together with local partners to improve and optimize operations by leveraging local assets and facilitating investments in infrastructure.

“It is still very difficult to work in these places where you see trillions of dollars on the ground, but poverty affects people on scale. It is time for communities in these emerging markets to be part of the game,” states Mr. Campbell.

Mr. Campbell is a supporter of global partnerships. For him, partnering with local companies and entrepreneurs could not only facilitate resource extraction but also help to drive local economic development.

This mutually beneficial solution could  improve local standards of living by fostering local industries and enabling access to new technologies—which, in turn, coul help local communities by driving long-term economic growth.