Zimbabwe announces $2.83 billion deal to locally process several metals, including lithium
Zimbabwe is currently the only African country to produce lithium. While Namibia, DRC, Ghana or Mali are preparing to join it, Harare is already exploring other ways to better take advantage of this resource.
In Harare on Friday, September 16, the government of Zimbabwe initialed a $2.83 billion memorandum of understanding with Chinese companies Eagle Canyon International Group and Pacific Goal Investment Ltd. The tripartite partnership concerns the construction in the southern African country of an industrial complex spread over 5,000 hectares intended to locally transform several metals including lithium.
According to details revealed by Bloomberg , $450 million will be invested in a lithium salt plant to be installed at the Mapinga site (Mashonaland West), located 48 km from Harare, in order to supply electric battery manufacturers directly. . Scheduled to be completed by the end of 2025, it should be a first on the continent.
In addition, Chinese investors have planned another plant to produce nickel sulphate at a cost of $1 billion, as well as a nickel-chromium alloy smelter for $500 million. To supply this huge complex, two 300 MW power plants will be built, at a unit cost of $250 million.
According to Lionel Mhlanga, head of Eagle Canyon International Group Holding, all of these refineries should generate, once in service, an annual turnover of more than $13 billion, while creating nearly 5,000 jobs.
If they have not yet been assessed, it should be noted that the revenues that the State should derive from this gigantic project will be substantial, both in terms of taxes and export earnings. For the country’s vice-president Constantino Chiwenga, these investments should notably help the government to reach its objective of $12 billion in annual mining revenues. In 2021, the country raised $5.2 billion, up from $3.65 billion the previous year.
“ The exploitation of our abundant natural resources must allow a greater number of our citizens to emerge from poverty and access prosperity ”, underlined the Head of State Emmerson Mnangagwa.
The Shades of the shadow…
While criticism very often fuses on the inability of African mining countries to locally transform the raw materials extracted from their basement, the partnership announced last Friday by the Zimbabwean government can give rise to hope. It corresponds in fact to a certain will of the leaders of these countries to take advantage of the energy transition to launch the massive industrialization of their mining sector.
The enthusiasm observed on the side of the Zimbabwean leaders does not, however, prevent us from wondering about several gray points of this agreement. The companies involved have not yet revealed how they intend to mobilize the colossal sum necessary for the realization of their various projects in the country. It should be noted that the two companies based in Hong Kong are not listed on the stock exchange.
The methods of supplying future factories are also a mystery for the moment even if the country has the only lithium mine currently in production on the continent and plans to put two new projects into production , still piloted by Chinese investors, as soon as ‘next year. It will nevertheless be necessary to reach an agreement with the various companies active in these projects so that they sell all or part of the production to local factories.
Finally, the previous projects announced in the mining sector by the current regime do not invite optimism. There is thus little progress concerning the platinum mines for which significant Russian and Cypriot investments have been announced in recent years.
