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Research
Africa’s resource wealth is clear, but policy unpredictability deters investment. Sudden regulatory shifts raise risk and erode confidence. Acorn & Partners helps investors navigate this complexity by decoding formal and informal policy signals, enabling smarter capital flows and positioning Africa as a key player in the global energy transition.
The continent’s resource potential is beyond dispute. From cobalt in the DRC to lithium in Zimbabwe and solar capacity across North, Southern and East Africa, the continent is pivotal to the future configuration of global energy systems. Yet despite growing global demand for critical minerals and renewable energy inputs, capital flows into these sectors remain far below potential.
The reasons are layered, but one factor that repeatedly surfaces across investor discussions is policy uncertainty. Investment is not just about the presence of resources or even infrastructure. It hinges on confidence in the rules that govern those resources over time. The challenge in many markets on the continent is not always the content of policy, but its unpredictability. Frequent shifts in mining codes, sudden export bans, and opaque enforcement create a climate where capital turns cautious.
In recent years, several governments have introduced policy shifts that caught investors off guard. In Zimbabwe, a sudden ban on the export of unprocessed lithium in 2022 disrupted financing strategies for junior miners who depended on raw exports to fund local processing. In Tanzania, mining regulations were tightened without consistent engagement, leading to prolonged arbitration. Zambia’s royalty regime has shifted more than once in the past five years, affecting long-term project economics. South Africa’s renewable energy programme has also faced reversals and delays in procurement cycles, eroding confidence among global developers.
At first glance, these moves may seem unanticipated. But viewed in context, they often represent strategic responses by states navigating asymmetrical power dynamics. These moves are often calibrated rather than irrational. They reflect a sovereign risk-reward calculus, where governments seek to extract greater value, reset legacy terms, or preserve strategic room for manoeuvre, even if that introduces short-term uncertainty for external capital.
This distinction is crucial. Investors are not deterred by reform. They are deterred by environments where reform is unsignalled, unexplained, or inconsistently applied. What capital struggles to absorb is not change itself, but the absence of process around change. Where rules shift without notice, or where enforcement becomes selective, modelling future cash flows becomes difficult, and the cost of capital rises accordingly.
Frontier and emerging markets outside the continent have grappled with similar dynamics and taken steps to build credibility. Chile, for instance, recently passed legislation designed to speed up permitting timelines for mining and energy projects by 30 to 70 percent while preserving existing regulatory standards, a move intended to reduce approval uncertainty and support investment (https://www.reuters.com/world/americas/chiles-congress-approves-law-speed-up-permitting-process-investment-projects-2025-07-01/). These examples suggest that stability is not the absence of change. It is the presence of a process that investors can understand, anticipate, and engage with.
For countries on the continent seeking to attract sustainable capital into minerals and energy infrastructure, the priority is not perfection, but predictability. The more transparent and consultative the rule-making process, the more patient and risk-tolerant the capital that follows. This applies especially to institutional and climate-aligned investors who are increasingly mandated to engage in high-impact regions but remain bound by governance and risk thresholds.
Understanding this policy dimension in local context is essential. It requires the ability to interpret not only what is written into law, but how rules are signalled, contested, and implemented at different levels. Assessing risk in these markets demands a synthesis of legal, political, and informal intelligence.
This is precisely where Acorn & Partners works. By mapping both the formal and informal dimensions of policy behaviour, we help investors understand where volatility reflects dysfunction and where it signals deeper strategy. In doing so, we enable capital to engage with the continent’s most strategically important markets on informed, realistic terms, positioning the continent not at the margins, but as a central player in shaping tomorrow’s global energy systems.