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Serbia is preparing to give Rio Tinto the green light to develop Europe’s largest lithium mine two years after Belgrade called off the project, paving the way for a major boost to the continent’s electric vehicle industry.
President Aleksandar Vučić said “new guarantees” from the Anglo-Australian miner and the EU appeared ready to resolve Serbia’s concerns about whether the necessary environmental standards would be met at the Jadar site in the west of the country.
In an interview with the Financial Times, Vučić said he was confident he would also secure the necessary commitments from EU leaders for related investments in Serbia, such as battery production and electric vehicle production.
As long as his demands for “the entire value chain plus perfect environmental protection” are met, Vučić said he expects business and political leaders to come to Belgrade next month to formally announce the project.
“If we deliver everything, [the mine] could be opened in 2028,” he said, adding that it is expected to produce 58,000 tonnes of lithium a year – “enough for 17 percent of EV production in Europe – around 1.1 million cars”.
He added: “I really believe it could be a game changer for Serbia and the whole region.”
The government revoked Rio Tinto’s licenses in January 2022 following protests led by environmental groups concerned about water pollution, displacement and damage to the area after the mine closed, blocking highways and bridges across Serbia.
They came as Vučić, who became prime minister in 2014 and president three years later, faced elections and domestic political pressure. But after municipal elections on June 2, in which Vučić’s ruling SNS party won a majority, the government appears to believe the coast is clear to proceed with the project.
The planned resurrection of the deal with Rio Tinto and the involvement of the EU are seen by Western officials as an important signal of Serbia’s geopolitical alignment at a time when it is being courted economically and politically by China, Russia and the Gulf states.
Serbia has been an EU candidate for more than a decade, but the accession process has moved slowly due to concerns in Brussels about issues such as the rule of law and corruption. Belgrade has also frowned on the EU over the status of its former province of Kosovo and is one of only two European countries not to impose sanctions on Russia over Moscow’s large-scale invasion of Ukraine.
EU officials “thought we would give [the mine] To the Chinese,” said Vučić. “We had no intention of doing that because we promised to deal with the EU.”
Vučić, who insisted he remains committed to Serbia joining the bloc, claimed that some European states tried to undermine the Jadar deal before coming on board. “They even participated in organizing protests here. . . I asked myself, why do they do this? They will lose everything and the Chinese will take it [their place].”
Europe currently has virtually no domestic lithium production, and Jadar could produce enough to meet 13 percent of the continent’s projected demand in 2030, according to Fastmarkets, a commodities research firm.
Jadar contained high-grade lithium and the mine’s deposits were large compared to others globally, said Martin Baker, principal analyst at Fastmarkets.
Siniša Mali, Serbia’s finance minister, said the project would provide a major boost to the Serbian economy and increase the annual gross domestic product by €10-12 billion to €64 billion in 2022. He noted that Serbia plans to ban lithium exports. the country wanted to “build a complete value chain”.
Belgrade has always favored the mine as long as it met strict environmental standards, Mali said. Its cancellation was partly a “political decision” to avoid unrest in the run-up to the election.
Savo Manojlović, co-leader of Go Change, the environmental group that led protests at the end of 2021, said opponents would not give up the fight if the deal was resurrected. “We will organize to defend our environmental standards and constitutional rights,” he said.
Chad Blewitt, Rio Tinto’s managing director for the Jadar project, said since the deal was blocked, Rio Tinto has held 125 meetings with the local community to garner public support.
The miner, which released a draft environmental assessment on Thursday that included estimates of potential impacts on water, air and land, would be “radically transparent” about its operations at the site, he said.
Rio Tinto said it welcomed a “fact-based public dialogue” and added that the draft assessment indicated the project could be “developed safely and in accordance with the strictest Serbian and EU environmental standards”.