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Africa’s silicon ambition: The missing link in global semiconductor supply chains

By , Founder and MD, ITLawCo.
20 Nov 2024
Nathan-Ross Adams, Founder and MD, ITLawCo. (Image: Supplied)
Nathan-Ross Adams, Founder and MD, ITLawCo. (Image: Supplied)

It begins with sand. The seemingly innocuous grains lining Africa’s vast deserts and riverbeds are the unassuming raw material for silicon—the backbone of the semiconductors that power our digital world. 

Yet, despite its abundance of natural resources, a growing tech-savvy workforce, and promising innovations, Africa remains largely excluded from the global semiconductor supply chain. 

In a time where chips dictate the balance of economic and geopolitical power, Africa stands at a crossroads: Will it rise as a critical player in the semiconductor ecosystem or remain a passive supplier of raw materials?

The silicon divide

Semiconductors, the lifeblood of modern economies, are embedded in everything from smartphones to electric vehicles. As the race for chip dominance intensifies, driven by the US-China rivalry and Europe’s strategic investments, Africa emerges as an underutilised yet crucial piece of the puzzle. 

The continent’s rich deposits of cobalt, tantalum, tungsten, and other critical minerals—essential for chip production—give it a unique advantage.

Africa’s resource wealth could reduce global supply chain risks and costs by minimising dependencies on external sources. 

However, historically, raw material exports have rarely translated into equitable economic gains for African nations. Much of the wealth has been extracted, leaving environmental degradation and limited reinvestment in local economies. 

This dynamic reflects a broader inequity: Africa supplies the resources but seldom participates in chip manufacturing, design, and innovation value-added processes.

Beyond minerals: The ecosystem awakens

Africa’s role in semiconductors need not be confined to mining. The continent boasts a youthful, technologically adept population and a burgeoning tech ecosystem. 

Countries like Kenya, Rwanda, Ghana, and Nigeria are emerging as innovation hubs, leveraging investments in education, infrastructure, and technology. 

Rwanda’s tech parks and Kenya’s dominance in the technology market exemplify how strategic initiatives can turn potential into reality.

Moreover, collaborations between local research centres and established global firms have sparked innovation. Cities like Nairobi and Lagos are producing design breakthroughs that could help position Africa as a semiconductor hub. 

These efforts show Africa’s capacity to move beyond resource extraction into chip design, assembly, and even fabrication—critical components of the semiconductor value chain.

The geopolitical gamble

Africa’s rise in the semiconductor industry is not just an economic opportunity but a geopolitical necessity. 

The global semiconductor market, worth hundreds of billions of dollars, is under immense strain. Rising costs and supply chain disruptions have prompted Western nations to diversify their chip ecosystems, presenting Africa with an unprecedented opportunity.

With its strategic resources and competitive pricing, Africa can offer solutions to rising production costs while contributing to global supply chain resilience.

However, this opportunity comes with risks. Without robust policy frameworks, Africa risks falling into the trap of neo-extractive models, where resources are exported, but benefits remain elusive. 

For the continent to secure its position as a semiconductor powerhouse, it must chart its path, negotiating equitable partnerships that prioritise local value addition and technology transfer.

The African Union can play a pivotal role in fostering a unified semiconductor strategy. A pan-African approach to chip manufacturing and design, underpinned by regional collaboration, could amplify economies of scale and attract investment.

 Additionally, Africa’s participation in global trade discussions must prioritise fair access to semiconductor technology and sustainable practices.

Building Africa’s semiconductor future

Africa’s transformation into a semiconductor hub requires a bold and coordinated strategy. Key steps include:

  1. Investing in value addition: Beyond mining, African nations must develop processing plants, fabrication facilities, and design centres. This approach ensures the wealth created from resources stays within the continent.
  2. Strengthening regional collaboration: Pooling resources and expertise across borders can overcome individual capacity constraints. A regional semiconductor initiative akin to the African Continental Free Trade Area could drive collective growth.
  3. Fostering innovation and talent: Africa’s youthful population offers untapped potential. Investments in STEM education, vocational training, and partnerships with global tech firms are critical for building a skilled workforce.
  4. Prioritising sustainability: The semiconductor industry’s environmental impact is significant. Africa has an opportunity to pioneer greener manufacturing practices, aligning with global sustainability goals while protecting its ecosystems.
  5. Establishing global partnerships: equitable collaborations with Western nations and Asian semiconductor leaders can accelerate Africa’s integration into the value chain. These partnerships must focus on long-term capacity building, not short-term resource extraction.

The road ahead

As the world pivots toward technological supremacy, semiconductors are becoming the keystone of economic and security frameworks. Africa has the resources, talent, and potential to become a central player in this ecosystem. However, realising this ambition requires leadership, investment, and strategic foresight.

The global semiconductor ecosystem is searching for solutions to rising costs, supply chain vulnerabilities, and geopolitical tensions. 

Africa’s competitive advantages—a dynamic workforce, abundant resources, and emerging innovation hubs—make it a promising partner in this endeavour. 

By embracing Africa’s potential, the global community fosters economic development and builds a more resilient and inclusive semiconductor future.

Africa’s silicon sands hold more than raw potential. They promise a future where the continent moves from the periphery to the centre of global technological progress. The challenge now is turning that promise into reality.

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