The Federation of German Industries (BDI) has recommended that the German government throw its weight behind the African Continental Free Trade ... Area (AfCFTA) Agreement, arguing the continent is pivotal in efforts to diversify markets.
Often referred to as ‘white gold’, the alkali metal is a key component in the production of many different types of batteries powering today’s technological marvels. Zimbabwe’s Bikita mine, in the southwestern province of Masvingo, happens to hold the world’s largest-known deposit of the alkali metal, at around 11m tonnes.
According to an African Mining Markets report, “Zimbabwe is the leading country in Africa to produce lithium ore, and the 4th largest in the world”. Harare is now looking to the worldwide surge in demand to help make its economic recovery plans a reality, thanks to its dominating position in the global supply of the mineral.
According to the International Data Corporation (IDC)’s Worldwide Quarterly Mobile Phone Tracker, Africa’s overall mobile phone market experienced year-on-year growth of 14% in the first quarter of 2021.
Meanwhile, the recent climate change summit (COP26) in Scotland saw world leaders call for countries to reconfigure and adopt technologies that can boost clean energy production. The trends have caught the eye of Zimbabwe’s mining sector.
“Continued demand growth in various sectors for battery grade (BG) lithium will apply greater demand-side pressure, as demand from lithium-ion battery manufacturers is expected to increase [by] 83.0% by 2027,” says a 2018 feasibility study from Prospect Resources, an Australia-based battery minerals company with a majority stake in the Arcadia Lithium Project open-pit mine outside Harare.
Given its vast deposits, the Arcadia project contends that “Zimbabwe can become a significant lithium province and will dominate the global supply”.
This is good news for President Emmerson Mnangagwa’s Vision 2030 economic blueprint, which calls for an industrialisation drive to create a $65 bn upper middle-income economy with a per capita income above $5,000 in the next decade. The plan envisions the mining industry as a key pillar for economic recovery, industrialisation and development.
Rich bounty or raw deal?
Zimbabwe Miners Federation spokesman Desmond Mangisi, however, tells The Africa Report that before the country can really benefit from its vast resources, it needs to add economic value to its extractive industry. This includes improving processes such as beneficiation, where worthless gangue minerals are removed from the valuable ore.
“The greatest mistake that the government has made is its failure to come up with effective environmental and economic policies,” he says.
Endowed with bountiful mineral resources, Zimbabwe has been “disenfranchised” by its lack of technical capacity to realise the full potential of its extractive sector, Mangisi says. In addition to lithium, the country is also rich in platinum, gold and diamonds.
“The curse of poverty in the midst [of] plenty is not entirely a Zimbabwe case, but [it] affects many African countries,” he says.
Communities are being suffocated by the exploration of the vast minerals, and there is nothing being done to benefit them.
Owen Dhliwayo, a researcher from the Platform for Youth and Community Development, tells The Africa Report that lithium mining could have huge financial and human capital benefits for the country, if done right.
“Currently Zimbabwe exports raw minerals as opposed to processed products. We are yet to reach a stage where there is both a legal and institutional framework for beneficiation,” Dhliwayo says.
Instead, the country is suffering the negative impacts of large-scale mining without attracting as many well-paying industrial jobs and foreign currency deposits as it could.
“Communities are being suffocated by the exploration of the vast minerals, and there is nothing being done to benefit them,” Dhliwayo says. “Others are facing eviction as a result of such extraction. Without capacity for beneficiation and value-addition, we are losing more than we stand to gain.”
Sanctions and corruption
The sector is also weighed down by Western sanctions imposed during Robert Mugabe’s brutal rule.
The US, for example, has sanctioned the Minerals Marketing Corporation of Zimbabwe (MMCZ), the state-run entity that handles all the country’s mineral exports. The MMCZ says the Treasury Department’s restraints on certain accounts and transactions have undermined Zimbabwe’s international trade in minerals.
After years of economic stagnation, Harare has turned to China, which has been happy to extend grants and loans to African governments without Western demands for transparency and accountability. In return, China has obtained mining concessions for diamonds, gold, chrome and lithium.
Nevertheless, some experts say corruption is the real culprit for the country’s stagnation.
“Sanctions on Zimbabwe have no direct [link to] its economic misery, as they target a small number of individuals,” says Stephen Chan, a professor of world politics at SOAS University of London.
“The performance of Zimbabwe’s economy is pinned on a number of factors, which include agricultural and economic policies introduced under Mugabe, that have a domino effect: chasing away investors, coercing the economy into distress. Zimbabwe has its own form of sanctions and that is corruption, lack of transparency and accountability,” Chan says.
In the absence of regulatory frameworks …the country is likely to remain economically stagnant.
According to the Zimbabwe Coalition on Debt and Development (Zimcodd), the country and its southern African neighbours lose out on $8.8bn a year because of theft and graft. Though the mining sector is the backbone of Zimbabwe’s export earnings, rampant corruption has severely curtailed its economic benefits.
Zimcodd Programs Officer John Maketo tells The Africa Report that without more regulation of mining revenues to prevent capital flight and illicit financial flows, the country cannot realise its potential and will remain mired in debt.
“Zimbabwe needs to strengthen its transparency and accountability legislation in public finance management to curb illicit financial flows,” he says. “In the absence of regulatory frameworks …the country is likely to remain economically stagnant.”
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