Prem14 Aug 2022 18:43
China wants lithium,Zimbabwe wants revenue.
"Zimbabwe possesses Africa's largest lithium reserves and the fifth largest globally but the resource has remained largely untapped due to a lack of investment.
Lithium ion batteries are commonly used in the EV manufacturing industry and in lithium batteries for electric devices as well as solar panels to store excess solar energy.
Battery metal specialists say the drive for clean technology initiatives and off-grid power storage has created an enormous demand for lithium batteries and electric vehicles in recent years. Demand is expected to accelerate rapidly.
Analysts say the deals provide precious opportunities for Zimbabwe to get involved in the crucial value chain of lithium battery industries not only for the EV industry, but for other renewable energy projects that also need energy storage facilities.
"These deals can facilitate technology transfer to Zimbabwe and enhance their preliminary industrial process capacity in the coming year. Financially, these resource exports can be particularly crucial to relieve the debt service pressure in the short run as the price of lithium has been and is expected to continue to rise sharply in the coming years," analyst Prosper Chitambara said.
He noted that China had been developing more stringent environmental impact evaluation systems for its overseas activities, led by the ministries of Ecology and Environment and Commerce.
As such, the lithium deals would provide good opportunities to see how these new policy documents are implemented on the ground, particularly in comparing Chinese-owned and jointly-owned (with Australian partners) mines.
"So, beyond the big challenge to balance short-term financial gains and long-term technological/industrial capacities, there is also a challenge to distribute the benefits between stakeholders at local, central and national levels.
"These deals present potential benefits and it takes time to see if these benefits can be achieved and distributed, which is always a big challenge for the host government when new treasures are found. From the perspective of African governments, they need to make autonomous decisions when addressing these considerations on opportunities and challenges without being trapped in geopolitical struggles and narratives," he said.
The Africa Finance Corporation says as the world becomes more conscious of the need to pursue net zero carbon emissions, a global battery and electric industry is growing at a fast pace and projects its worth at US$8,8 trillion by 2025 and US$46 trillion by 2050.
Because Africa is home to key battery minerals such as cobalt, copper, lithium and manganese, the continent can profit immensely from the global movement towards decarbonisation.
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