The Convergence

In Q1 2026, three forces have converged to create the most complex political risk environment for African mining investment in over a decade. Investors who prepared only for tax efficiency are discovering — too late — that the rules of the game have fundamentally changed.

The Old Framework Is Broken

For two decades, the playbook for investing in African mining was relatively straightforward. Structure through a favourable jurisdiction for tax efficiency. Rely on bilateral investment treaties for legal protection. Assume that regulatory frameworks, while imperfect, would remain broadly stable between electoral cycles. Export under preferential trade arrangements like AGOA. This framework is now changing.

What has replaced it is not a new stable order but a period of acute uncertainty driven by three simultaneous forces that are interacting in ways that amplify risk across every dimension of a mining investment. Understanding these forces — and their interconnections — is now a prerequisite for any serious capital deployment on the continent.

Force One: The President Trump Disruption

The second Trump administration has executed the most significant reorientation of US-Africa policy since the end of the Cold War. The shift is not merely rhetorical. It has produced concrete policy changes that have set new benchmarks for the entire architecture of Western engagement with African economies. The three pillars of US-Africa engagement are now:

Critical minerals access, counterterrorism and transactional deal-making.

The most consequential single event was the effective nullification and subsequent expiry of the African Growth and Opportunity Act (AGOA) in September 2025. For 25 years, AGOA provided duty-free US market access for nearly 1,800 goods from over 30 African nations. It was reinstated temporarily for year 2026, just to provide time for US to negotiate individual deals with eacfh African State. The AGOA disruption was compounded by the Liberation Day tariff regime announced in April 2025, which imposed baseline 10% tariffs on 29 African countries and escalated rates up to 50% on others. In short, even if AGOA is reinstated, the Liberation Day tariffs stay and are applied over and above.

USAid was dismantled with 90% of foreign contracts terminated, and as NATO allies were asked to redirect 5% of GDP to defence, the EU has also had to reduce support to Africa.

For mining investors, the implications cascade. African host governments are losing revenue from US trade access precisely when they are under domestic pressure to extract more value from their mineral resources. The fiscal gap created by AGOA’s disruption and new US tariffs accelerates the turn toward resource nationalism. Meanwhile, Trump’s threat of an additional 10% tariff on countries aligning with BRICS has forced African governments into difficult geopolitical positioning choices that directly affect their investment and trade policies.

Force Two: Africa’s Sovereign Turn

The second force predates Trump but has been dramatically accelerated by the current geopolitical environment. Across the continent, governments are rewriting the rules of resource extraction through a wave of mining code reforms, BIT terminations, local content mandates, and export restrictions that collectively represent the most significant assertion of resource sovereignty since the post-independence nationalisations of the 1960s and 1970s.

The scale is impressive. Mali’s 2023 Mining Code imposed a 10% free, non dilutable state stake, (up-able to 30%) maximum state participation and additional 5% mandatory sale to Malian Private Investors with total of 35% possible local ownership. Burkina Faso increased its free-carried interest from 10% to 15% in 2024. Zimbabwe, Tanzania, and Ghana have banned raw lithium exports. Zambia’s new local-sourcing legislation took effect on 1 January 2026. South Africa published a Draft Mineral Resources Development Amendment Bill in May 2025 that would compel every mineral producer to make minerals available for local “beneficiation”.

Simultaneously, the bilateral investment treaty framework that has protected foreign investors for decades is being systematically dismantled.  Kenya terminated its BIT with the Netherlands in 2023 (effective 2024), following South Africa, Tanzania, and Burkina Faso. The AfCFTA Investment Protocol mandates the termination of more than 100 intra-African BITs within five years and is designed to limit or exclude investor-state dispute settlement. In November 2024, over 40 civil society organisations adopted the Entebbe Declaration calling for fundamental reform of global investment frameworks.

This is not random policy drift. It is a coordinated, continent-wide reassertion of sovereign control over natural resources, driven by genuine economic logic. African governments recognise that the global energy transition has made their minerals strategically indispensable, and they are leveraging that position to demand better terms.

Force Three: The Chinese Acceleration

China’s response to the vacuum created by Western disruption and retreat has been swift and strategic. Now controlling a considerable percentage of global critical minerals production as well as processing and refining capacity, Beijing has moved aggressively to consolidate its position across Africa’s mining landscape.

Chinese M&A spending in Africa represents 49% of its $14.6 billion in total overseas mining M&A since 2020. In the DRC, Chinese entities own 72% of cobalt and copper mines. Zhejiang Huayou Cobalt’s $400 million lithium processing plant in Zimbabwe is set to begin production in Q1 2026. Chinese companies have invested $4.5 billion in African lithium mines in recent years alone.

The competitive dynamics shifted further in June 2025 when China removed tariffs for 53 African countries — a direct counter to Washington’s tariff escalation. The message to African governments was unmistakable: There are options to Western partnerships, investments and capital.

Notably, the Trump administration is attempting to counter Chinese competition through aggressive deal making – the US DRC minerals deal (Dec 2025) secured preferential access to cobalt and copper reserves, tied to brokering Rwanda peace and the Lobito Corridor minerals transport to reduce dependence and cost reliance on other transport means. 

Chinese dominance is itself generating pushback. Congolese civil society groups are demanding a fresh review of the Sicomines deal, citing $132 million in losses from tax exemptions in 2024 alone. Niger expelled Chinese oil sector officials. The DRC renegotiated its infrastructure-for-minerals agreement, pushing China’s commitment from $3 billion to $7 billion. African resource nationalism does not appear to discriminate by the investor’s flag — it responds to the perception that insufficient value is being retained domestically.

The Convergence: Why This Matters Now

Each of these forces alone would represent a significant shift in the risk environment. Their simultaneous occurrence creates something qualitatively different: a systemic reconfiguration of the terms on which foreign capital can access African mineral resources.

The old model assumed that tax structuring, BIT protection, and trade preferences would remain the stable foundations on which investment decisions were made. Today, trade preferences are been reducing, BIT protections are being reconsidered, and regulatory frameworks are being rewritten on electoral timescales. Tax structuring remains important but is now necessary rather than sufficient.

What is required is a fundamentally from investors is a different approach to political risk — one that treats electoral cycles, policy shifts, and geopolitical realignment as the primary variables rather than background noise. Let’s be clear, elections do not by themselves bring up changes, they are, repeatedly opportune moments to redeclare  (and execute) the “new” economic narrative. Investors who structure for elections, not just tax, are the ones positioned to navigate what comes next.

Two Strategic Risks for 2026

From this convergence, three high-level risks demand the immediate attention of every investor, mining company, equipment supplier, and service provider operating in or targeting African mining markets:

Risk 1: The Regulatory Ratchet

The modern resource nationalism in Africa generally englobes options for States, inter alia, seen as:

• Greater regulatory oversight of mining operations;
• Increased taxation and royalty structures;
• Mandatory in-country processing and value addition;
• Export restrictions on unprocessed minerals;
• Strategic government participation in mining projects;
• Revocation of licences.

The fiscal pressures created by AGOA’s disruption and uncertainty and new tariffs will intensify the revenue imperative driving these reforms. Elections in Zambia (August 2026), Ghana (completed December 2024 with policy implications still unfolding), Senegal (legislative), and South Africa’s evolving coalition dynamics all present near-term catalysts for further policy shifts.

Risk 2: The Treaty Protection Gap

The systematic dismantling of BIT protections is not a reaction to Trump Administration policies but part of a longer wave of African sovereignty reassertion than began with South Africa’s groundbreaking 2010-2012 review of its BIT protection. It terminated 13 EU BITs in about 2 years.  the momentum comes from PAIC regional commercial regime which has filtrated to the African Union enacting investment protocol in 2025, putting pressure on member states to terminate all investment protection treaties, following the EU example of cancelling inter-European treaties to create one “Fortress Europe” in the past. In short, the scope for restructuring through jurisdictions with robust, surviving treaty networks is narrowing.

Implications for Mining?

A risk assessment by segment would suggest the following for 2026+

Segment	Risk Level	Key Considerations
Junior Mining	HIGH	Greenfield projects face maximum regulatory uncertainty; nationalisation risk and may need strong local partnerships.
Mining Companies	MEDIUM - HIGH	Existing operations face renegotiation pressure; processing requirements increasing.
Equipment Providers	MEDIUM	Less direct exposure but may face local content requirements.
Consultants	MEDIUM - LOW	Services remain needed. Payment repatriation concerns.
Investment funds	VARIABLE	BITs remain valuable where they exist.

The convergence of these three risks means that 2026 is not a year for passive investment monitoring. It is a year that demands active political risk intelligence, proactive structuring, and the kind of foresight that only comes from understanding elections as the primary drivers of mining policy change across Africa.

This article is published by Effen Holdings Ltd for general informational purposes only and does not constitute legal, financial, or investment advice. Readers should consult qualified professional advisors before making any investment or structuring decisions. Contact us for a confidential review of your specific situation.

About Effen Holdings Ltd

Effen Holdings Ltd is a political risk intelligence company specialising in African investments. In partnership with DTOS Mauritius, we help investors structure for elections, not just tax — providing the foresight to anticipate policy shifts before they impact your portfolio.