2024-07-21 23:34:16
The EU and Serbia have reached a key cooperation agreement in the field of lithium mining, which is expected to boost the Serbian economy and support the production of European electric cars. However, the opposition and environmentalists in Serbia are against the development of lithium deposits in the country.
The memorandum of understanding, providing for lithium mining in northwestern Serbia and production of batteries and electric vehicles in the country, was signed in Belgrade on Friday by Serbian Minister of Mining and Energy Dubravka Jedovic Handanovic and European Commission Vice President Maros Šefčović in the presence of Serbian President Aleksandar Vucic and German Chancellor Olaf Scholz, Tanjug reported, quoted by BTA.
Within the framework of the meeting, called “Critical Raw Materials Summit”, a letter of intent for the production of batteries and electric vehicles in Serbia was also signed by the Minister of Economy, Adriana Mesarovic, the President of the European Bank for Reconstruction and Development (EBRD ) Odile Renault-Basso and representatives of the German state development bank KfW Group, the Italian Development Bank and interested companies. Among these companies were “Mercedes-Benz” (Mercedes-Benz) and the Franco-Italian car manufacturer “Stellantis” (Stellantis), which realize almost a quarter of car sales in Europe.
The deal comes amid a global race to secure the precious metal, which is used to make batteries for electric cars, and car companies will increasingly need lithium as the transition to zero-emission cars accelerates.
The agreement came just days after Serbia’s constitutional court and then the government gave the go-ahead to Australian mining company Rio Tinto’s $2.4 billion project to mine lithium in the Jadar Valley in northwestern Serbia. In 2022, after mass protests organized by eco-activists, the authorities revoked Rio Tinto’s permission to implement the project. If developed, the Yadar lithium project could cover 90 percent of Europe’s current lithium needs, Reuters notes.
Conservationists, local and opposition politicians continue to express concerns that the mine could contaminate water sources and negatively impact local communities.
The expectation is that the development of the lithium deposit in northwestern Serbia will give a significant boost to the European car industry and provide some raw material independence for the EU in terms of lithium.
Sefcovic hailed the agreement as a “historic day for Serbia as well as for Europe”. He assured that the extraction of the valuable raw material will meet the strictest environmental standards and will monitor their implementation.
Scholz pointed out after the signing of the document that the agreement will “strengthen our cooperation in the supply of raw materials”.
This is an important European project and contributes to Europe remaining independent in a changing world, to be independent in the supply of raw materials, Scholz said.
Germany, Europe’s biggest carmaker, is looking to secure lithium for its electric car makers amid EU efforts to reduce its reliance on imports of the valuable raw material from China. China currently dominates the supply chain for lithium-ion batteries used in electric vehicles.
Before Scholz’s visit to Belgrade, in an interview with Germany’s Handelsblatt, quoted by Serbian media, Vucic said that Chinese automakers had shown interest in buying lithium, but “we told them that we are discussing this matter with the Europeans. We are loyal to Europe, the EU needs lithium and we want to strengthen our relationship with the EU.”
According to the Serbian president, Serbia will produce 58,000 tons of lithium per year, which would be enough for 1.1 million electric cars.
The new partnership can help position the Serbian economy as key to the European green transition, and according to the authorities, it will also bring significant revenues and investments.
It could also improve the country’s ties with the EU, which in recent years have been somewhat marred by Belgrade’s proximity to Moscow and Beijing. Serbia has been a candidate country for EU membership since 2012. Belgrade also faces criticism from Brussels on the rule of law, media freedom, corruption and dialogue to normalize relations with its former province of Kosovo, whose independence it does not recognize.
“We see you, we wish you in the EU, and a project like this will only speed up the process,” Maros Šefčovič said after the signing of the memorandum, as quoted by regional TV En1.
He stressed that Serbia could become the first European country to manage the entire chain needed to produce electric cars in the country, starting with lithium mining.
Vucic noted that it will take time for mining to begin, but it will, and the project has the potential to generate 4 percent of Serbia’s gross domestic product last year, which was about $75 billion, Reuters noted.