Zimbabwe’s Lithium: The Future of an ailing Economy?

A lithium stone is seen at a news conference of Macusani Yellowcake and Plateau Energy in Lima. Picture: Supplied
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Zimbabwe has the largest lithium reserves in Africa and fourth worldwide with some lithium mining projects in the exploration phase forecasted to kick-start production this year. The Bikita Lithium mine is one of the biggest in Zimbabwe with a reserve of 10.8 million tons of lithium ore, containing a lithium content of 1.4 percent, or 150,000 tons.

By Takudzwa Changadeya

The surge in global demand for electric cars, powered by lithium batteries, has increased the demand for minerals such as copper, lithium, graphite, and cobalt. The rapid development of the lithium-ion battery market in the world has accelerated the consumption of lithium resources.

This means the cost of lithium and the usage of metal is increasing annually, which has resulted in a massive jump in lithium export earnings for numerous economies.

With the demand for lithium batteries in the new energy auto industry growing worldwide, lithium ore has become an indispensable raw material for the industry and Zimbabwe stands to take the yield of a windfall to boost its earnings.

Under the background of the active development of lithium batteries and ICT products worldwide, Zimbabwe recently decided to ban all raw exports of lithium ore to capitalize on a surge in demand and prices in the global market.

It is estimated that the smuggling of lithium to countries like South Africa and the UAE costs Zimbabwe nearly $1.8bn in lost mining revenue annually.

Therefore, the new regulation was designed to “ensure that the vision of the president to see the country becoming an upper-middle income economy has been realized.” This statement was issued in a circular under the Base Minerals Export Control Act published by the Zimbabwean Ministry of Mines and Mining Development in December 2022.

“We want to see lithium batteries being developed in the country,” claims the deputy minister of Mines and Mining Development, Polite Kambamura. He added, “We have done this in good faith for the growth of the industry.”

Zimbabwe is aiming to supply 20 percent of global lithium demand when all the country’s lithium resources have been fully utilized. The government is hoping to use lithium mining as the main attraction to foreign investors, which could change the development prospects of Zimbabwe’s lithium mining industry.

Zimbabwe will soon climb higher on the rankings of major producers of lithium with many greenfield mining projects at various stages of development. From 2023, it is expected that lithium will generate about US$500 million in total mineral exports, reaching US$12 billion before the year ends.

Foreign investors are now scrambling for lithium not only in Zimbabwe, but across Africa. A study by Rystad shows that while the world’s biggest economy, the U.S. owned 65 percent of the world’s lithium processing and refining facilities in 2021, it accounts for less than 25 percent of deposits. This statistic gives Zimbabwe a good chance of thrusting into the industry should it efficiently manage its lithium resources.

Lithium mining is among the minerals expected to grow the Zimbabwean mining sector to $12 billion in 2023.

Given its vast deposits of lithium, Zimbabwe could grow into a significant lithium source and potentially dominate the global supply.

The lithium mining industry will foster the realization of the country’s Vision 2030 economic blueprint, which calls for an industrialization drive to create a $65 billion upper-middle-income economy with a per capita income above $5,000 in the next decade.

Takudzwa Changadeya is a freelance journalist based in Harare, Zimbabwe. This was first published here by the African Liberty.