U.S. Development Finance Corp. Pumps $62.8 M into African Rare-Earth Projects

The U.S. International Development Finance Corporation announced a $62.8 million commitment to rare-earth projects across four African nations, with the bulk of the money directed to the Phalaborwa operation in South Africa, which is supported by Dublin-based TechMet. Executives, speaking anonymously, said that private investors are currently unwilling to fund these initiatives due to high risk profiles and concerns that Chinese market actions could undermine project economics.

The DFC’s goal is to move the projects to a less risky stage that could later draw private sector money. Rare earths are critical for electric-vehicle motors, wind-turbine generators and defense systems, and the United States is seeking to lessen reliance on China, the dominant global supplier. Analysts point out that the pipeline of announced projects outstrips the market need for neodymium-praseodymium magnets. Africa already represents about a quarter of the DFC’s worldwide investment portfolio.