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The global race for critical minerals is changing the position of resource-rich countries across Africa, Asia and Latin America. Minerals such as cobalt, nickel, lithium and rare earth elements are essential to clean-energy technologies, advanced manufacturing, consumer products and defense. As demand grows, producer countries are looking for ways to move beyond simply extracting ore and shipping it abroad. The goal is increasingly to capture more value at home.
That shift gives producer countries more bargaining power. The question is whether that mineral leverage can translate into long-term development or create new dependencies. The answer will depend on what happens beyond the mine: processing capacity, infrastructure, governance, market diversification, and institutions' ability to manage new revenues and strategic policies.
Recent developments in the Democratic Republic of the Congo (DRC) illustrate this shift. In October 2025, the country replaced an eight-month cobalt export ban with a quota system. The new framework set annual export limits for 2026 and 2027, while reserving a portion for strategic national purposes. The policy reflects a broader attempt to manage supply, support domestic interests, and strengthen the country's position in a market where the DRC remains the world's leading producer of mined cobalt.
Indonesia offers another example. Its 2020 ban on raw nickel ore exports pushed investment toward domestic processing and refining. According to Indonesia's Coordinating Ministry for Economic Affairs, exports of downstream nickel products reached about $33.5 billion in 2023 and were estimated at around $40 billion in 2024. The experience shows how control over raw-material exports can serve as part of a wider industrial policy rather than an isolated trade restriction.
These cases matter beyond Indonesia and the DRC. Producer countries increasingly use mineral policy to negotiate domestic processing, capture more value, and gain a greater voice in supply-chain decisions. That changes the terms of engagement for major consuming economies, including the United States. Producer countries have increasing leverage. But can they use it to foster durable development?
Translating Leverage into Development
Export restrictions can work when they fit within a coherent industrial strategy. Indonesia's experience suggests that restricting raw exports can encourage investment in refining and downstream industries. The DRC is pursuing a different route through cobalt quotas, linking export volumes to national priorities and giving the state greater control over a strategic share of supply.
But leverage by itself does not create development. Producer countries still need reliable electricity and transport, skilled workers, financing, processing technology, and institutions that can enforce policy. Without those foundations, export controls can raise expectations without delivering enough productive capacity.
Dependency at Another Address
Resource nationalism can increase domestic value creation while leaving a country dependent on a small number of foreign investors, buyers, or technologies. Indonesia has captured significantly more value from nickel, but parts of its industrial ecosystem remain closely connected to foreign capital and demand. The lesson is not that resource nationalism has failed; it is that value addition must be accompanied by diversification.
The DRC faces a similar challenge. If cobalt policy reduces dependence on one market but leaves the country reliant on external firms for refining, technology, finance, or logistics, dependency has not disappeared — it has simply moved to another part of the value chain. Producer countries therefore need multiple buyers and investment partners, as well as stronger domestic and regional processing capacity.
Governance Gaps Can Undermine Credibility
Mineral control creates leverage, but governance determines who benefits. Export restrictions and quotas are only as credible as the institutions that allocate, monitor, and enforce them.
The DRC's experience highlights why transparency matters. The Extractive Industries Transparency Initiative (EITI) documents the country's efforts to improve disclosure of mining revenues, contracts, and beneficial ownership, while also identifying areas to strengthen transparency. These systems matter because opaque allocation of mineral rights or export quotas can undermine public trust and create opportunities for elite capture.
The broader lesson is simple: a strong mineral policy needs strong institutions behind it. Published contracts, clear allocation criteria, independent oversight, and reliable administrative systems are not side issues; they are what turn mineral leverage into credible economic policy.
Great Power Rivalry Raises the Stakes
Critical minerals now sit at the intersection of industrial policy, energy security, and geopolitics. Producer countries are therefore negotiating in an environment where the United States, China, the European Union, and other major economies are competing for secure supplies.
The Minerals Security Partnership — a U.S.-led grouping of 14 countries and the European Union focused on fostering investment in critical minerals supply chains — reflects this competition, while also emphasizing diversified supply chains, local value addition, and environmental, social, and governance standards. The 2025 G20 Critical Minerals Framework similarly recognizes the need for producer countries to benefit more from processing and value addition.
For producer countries, this competition creates an opportunity to negotiate better terms — but only if they avoid replacing one dependency with another. Collective bargaining, regional cooperation, and stronger South-South trade can help countries negotiate from a stronger position.
Policy Recommendations
For the United States and other major consuming economies:
- Make critical-minerals financing and trade agreements more transparent, including clear terms for quotas, contracts, and investment arrangements.
- Use development finance to support refining, processing, logistics, and other value-adding infrastructure in producer countries, not only extraction. The U.S. International Development Finance Corporation's recent critical-minerals investments show how development finance can strengthen supply-chain resilience.
- Treat producer countries as partners in designing critical-minerals governance, rather than simply as suppliers of strategic commodities.
The Minerals Security Partnership and multilateral institutions should expand mineral-producing countries’ meaningful participation so that those whose resources underpin these supply chains have a stronger voice in setting the rules.
Global South producer governments should pair export controls with transparency requirements such as the EITI Standard, diversify buyers and investment partners, and invest mineral revenues in infrastructure, customs, skills, and processing capacity.
Regional cooperation is especially important in Africa. The African Continental Free Trade Area (AfCFTA) provides a platform for deeper intra-African trade and regional value chains, helping producer countries reduce dependence on a single market.
Conclusion
Indonesia’s nickel strategy and the DRC’s cobalt policy show that mineral-producing countries are no longer passive participants in the global minerals order. They are using their resources to influence investment, processing, trade, and negotiations with powerful external actors.
But leverage is only the beginning. Without diversification, transparency, and strong institutions, it can remain temporary or create a new form of dependency. For the United States, the more durable strategy is to build partnerships around shared value: invest in producer-country processing, support transparent governance, and give resource-rich countries a meaningful role in shaping the supply chains that depend on their minerals.
The future of critical-minerals security should not be built around who controls the mine alone. It should be built around who has a stake in the value chain and who gets to help shape its rules.
This paper series was published in collaboration with the Heinrich Böll Foundation, Washington D.C.
