There was quite some reaction over appointment of Cabinet Secretary for Mining and Blue Economy Hassan Joho last week. Some good and some bad.
But some of the negative reactions to the incumbent, particularly over his academic qualifications were irritating and downright discriminating.
Not all classrooms have four walls. For some, learning by doing and stumbling is more rewarding than sitting at a desk listening to a teacher lecturing. And yes, the new office bearer has a lot of “learning” to do.
It has emerged that the country has immense underground wealth after a survey found that there are 970 minerals nationwide.
Although classified as “potential prospects” for further exploration, we are talking of critical minerals such as Nickel and Cobalt. Guess, part of the initial business to execute will be: how do we take advantage of this new find?
Assuming the reserves are significant and can be mined profitably, the markets are wide open. The last five years have seen an acceleration in the value of trade in unprocessed critical minerals.
Some reports show that trade in critical minerals has been growing at an average annual rate of 10 percent. China stands as the largest importer of critical minerals, accounting for 33 percent of the global total, followed by the European Union at 16 percent, and Japan and the United States both at 11 percent according to the World Trade Organisation (2022).
The International Energy Agency (IEA) estimates consumption of these minerals could increase sixfold by 2050. Chile stands as the world's leading exporter of critical minerals, accounting for 11 percent of global exports, followed by South Africa (10 percent), Australia, Peru, and the Russian Federation (all at six percent).
Notably, this rise is underpinned by the recent commitments at the 2023 COP28 Climate Change Conference in Dubai to triple renewable energy production and the trend towards electric vehicles.
The latter is radically transforming the transport sector. By the end of 2023, electric vehicles accounted for more than a third of all car imports in value terms.
For energy-related critical minerals, the annual trade is estimated to stand at $378 billion up seven times over the past 20 years.
To capitalise on this demand, the CS may need to attract investment for refining and processing facilities. He also needs to increase technology transfer to enhance local capabilities to participate in higher-value stages of these clean technology supply chains.
Last but not least, he needs to ensure fair distribution of the benefits derived from trade in mineral resources. Indirectly, these special efforts should help meet the goals of a sustainable transition to a low-carbon economy - reducing greenhouse gas emissions and maintaining the objective of the Paris Agreement to remain within a global temperature rise limit of 1.5 degrees Celsius.
More importantly, the measures will add to the economy. Currently, according to the Kenya National Chamber of Commerce and Industry, the mining sector contributes less than one perecent of Kenya’s gross domestic product (GDP) but holds potential to contribute four to 10 percent.
Mwanyasi is MD, Canaan Capital
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