EU signs ‘historic’ deal on Serbian lithium deposits

The European Union hailed a deal with Serbia on lithium mining as a “historic day for Serbia and Europe”, ending the race to reach a deal.

Serbia on Tuesday reinstated mining giant Rio Tinto’s license to mine minerals in the Jadar Valley in the west of the country.

German Chancellor Olaf Scholz arrived in Belgrade on Thursday evening and backed a deal he said would help safeguard Europe’s economic security.

Mr Scholz is keen to ensure the country’s car industry is at the front of the supply queue.

As the transition to zero-emission vehicles accelerates, carmakers will need more lithium batteries, and Rio Tinto’s Jadar project can meet nine-tenths of Europe’s current lithium needs.

European Commission Vice President Maros Sefcovic also attended a meeting in Belgrade on Friday dubbed the “Critical Raw Materials Summit.”

He joins what he calls “the best of the best” European companies with a strong interest in new sources of lithium.

These include Mercedes-Benz and Stellantis, which account for almost a quarter of European car sales.

Representatives of lithium battery manufacturers also witnessed the signing of an agreement between Serbia and the European Union to establish a “strategic partnership on sustainable raw materials, battery production chains and electric vehicles.”

Sefcovic called it a historic day, while Olaf Scholz celebrated securing the continent’s largest known lithium reserves, which should reduce reliance on Chinese supplies.

“This decision required courage, but it was taken at the right moment,” he said, adding that the move would ensure Europe “remains sovereign in a changing world” and “is not dependent on other countries.”

It’s a tribute to Serbia’s leadership, which lifted a ban on lithium mining after a court ruling last week declared it unconstitutional. The government imposed the moratorium in 2022 after widespread protests across the country.

Environmentalists were not the only ones taking part in the demonstrations. Many of those blocking roads and bridges were participating in protests for the first time. They were all shocked that a foreign company had obtained mining rights through a process they considered opaque.

They are concerned about the potential impact on the Jadar Valley’s vital food and water sources.

Despite assurances from Serbian President Aleksandar Vucic, these concerns have not gone away.

“We will never hide anything from our employees at any stage of the mine’s opening, in any part of the process,” he said at the signing ceremony.

“As president, I will personally fight for the environment and the lives of the citizens of Jadar to keep their water and air clean.”

Vucic is also keen to highlight the potential financial benefits. He insists Jadar’s lithium will stay in the country.

Maros Sefcovic said this means Serbia will become the first European country to have “the entire value chain from lithium to electric vehicles made in Serbia”.

Opposition parties remain unconvinced by the president’s environmental assurances. They never believed the lithium mine was abandoned forever. Now they are demanding a return to transparency on the Rio Tinto project.

“There is a complete lack of trust in the government when it says it is in the interests of citizens,” said Biljana Djordjevic, co-leader of the Green Left movement.

“We are concerned that Serbia will be sacrificed by providing lithium for electric vehicles, which almost no one in Serbia can afford.”

This means that despite celebrations in Brussels, Berlin and Belgrade, protests against lithium mining in rural Serbia could return with a vengeance.