Zimbabwe Urges Local Production Of Battery-Grade Lithium, May Impose Tax
Zimbabwe’s Mines Minister, Winston Chitando, has reiterated that lithium miners must develop local production of battery-grade lithium and may face a tax on exports of lithium concentrate in the future. The southern African country holds significant reserves of lithium, a crucial battery mineral for cleaner energy technologies, which Zimbabwe hopes will help revive its struggling economy.
Chinese firms, including Zhejiang Huayou Cobalt, Sinomine Resource Group, Chengxin Lithium Group, and Canmax Technologies, have invested over US$1 billion in acquiring and developing lithium projects in Zimbabwe.
While some of these companies’ projects have started production and are expected to build up to nearly 1.5 million tonnes of lithium concentrates annually, Zimbabwe now wants miners to go beyond the production of concentrates that are shipped for further processing outside the country, mostly to China. Chitando suggested that the government aims to move up the value chain and encourage miners to produce battery-grade lithium locally.
Chitando explained that the government may impose a levy or even ban the export of lithium concentrates once companies can value-add beyond lithium concentrates. Chitando said in an address at the Zimbabwe Chamber of Mines annual general meeting:
Obviously, what the government wants is to move up the value chain, but it won’t happen overnight.
As government, once we have an entity which can value-add beyond lithium concentrates and go a stage higher, two things will happen; the extreme case will be to ban the export of lithium concentrates, which won’t happen, or we will impose a levy.
However, Huayou, which invested about US$700 million to acquire and develop Zimbabwe’s Arcadia lithium mine in 2022, expressed concerns about producing battery-grade lithium in the near term due to Zimbabwe’s lack of renewable power and key materials, such as natural gas and chemicals, whose importation would be unaffordable.
