Growth Gateway: Investing in critical minerals processing in Africa, Zambia investment case (summary)
Published 10 October 2025
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Zambia is strategically positioned to benefit from the global surge in demand for critical minerals, particularly copper and cobalt, driven by the green energy transition and electric vehicle adoption. With copper demand expected to double by 2040 and cobalt remaining essential for battery technologies, Zambia’s established mining sector and proximity to the Democratic Republic of the Congo (DRC) (which supplies 70% of global cobalt) offer a strong foundation for midstream processing.
Zambia currently processes over 95% of its copper to blister/anode and 20% to 25% to cathode, with underutilised capacity and plans for expansion. Investment opportunities include £400 million to £1.2 billion in new copper smelters and £60 to £200 million in cobalt refining.
Zambia’s competitive advantages include globally competitive electricity tariffs (as low as $0.04/kWh), a power mix that is over 85% renewable, and a well-connected transport network linking mines and Special Economic Zones (SEZs) to regional ports.
The government offers attractive fiscal incentives, including tax holidays and duty exemptions in Multi-Facility Economic Zones (MFEZs), and is actively encouraging private sector participation in renewable energy through IPPs and C&I solar projects. Political stability, a clear legal framework, and preferential trade access to the UK, EU, US, and China further enhance Zambia’s appeal to investors.
However, challenges remain. These include energy reliability due to hydro-dependence, road infrastructure quality, policy uncertainty (for example, the proposed MRC Bill), and a shortage of skilled labour and chemical reagents for processing. Corruption and artisanal mining also pose ESG risks.
Despite these, Zambia’s strong fundamentals and government commitment to reform create a promising environment for UK investors to support sustainable, resilient supply chains in critical minerals while contributing to Zambia’s economic development.