Finding friends: Europe, Serbia, and the lithium catalyst

Material values

Lithium plays a central role in the global shift to sustainable and clean energy. It is a crucial component for electric vehicle batteries, among other uses.

Since 2021, the European Union has signed partnerships to secure the supply of such critical raw materials with 14 countries, including Argentina, Norway, and Zambia. The bloc aims to transition from fossil fuels to renewables and clean technology and become climate-neutral by 2050.

The EU is also formally committed to promoting democracy and the rule of law across the world, but especially in its near-neighbourhood – including the Western Balkans, where many states are candidates for EU membership.

Working with Serbia

This month, Serbia and the EU held a critical raw materials summit in Belgrade, attended by German chancellor Olaf Scholz and European Commission vice-president Maros Sefcovic. The two sides signed an agreement on sustainable raw materials, battery value chains, and electric vehicles. They now intend to draw up a roadmap within six months containing concrete actions to develop a strategic partnership. Also at the Belgrade summit were representatives of car manufacturers Merzedes-Benz and Stellantis.

The tricky part

Serbia is home to one of the largest lithium deposits in the world. The Jadar valley is estimated to contain 200 million tonnes of lithium-borate ore, providing the potential to meet 10 per cent of global lithium demand. This could help build 1.1 million electric vehicles annually.

Democracy, the rule of law, and media freedoms have all weakened under Serbian president Aleksandar Vucic. Concerns about governance have caused critics to worry the new strategic partnership will fail to deliver a regulatory framework that ensures responsible mining practices in Serbia.  

There is little sign yet the EU will use this new strand of its relationship with Serbia – which is a candidate to join the bloc – to boost formal efforts through the accession process to address these problems. In Belgrade, Scholz reiterated Germany was ready to support Serbia to implement democracy and rule of law reforms.  

Equally, as a candidate country Serbia is supposed to align its foreign and security policy with that of the EU. But it is yet to join the bloc in sanctioning Russia following the latter’s invasion of Ukraine. And, while the EU intensifies its efforts to derisk its relationship with China, Vucic hosted Chinese leader Xi Jinping in Belgrade in May and has signed a contentious extradition treaty that could put Chinese dissidents at risk. Serbian authorities also appear to be targeting anti-war members of the Russian diaspora. Critics are correct that the EU has long requested the Serbian authorities to make improvements, to no avail. However, there is a chance this time could be different. The EU has a genuine opportunity to influence good governance and best practices through the new partnership, which holds huge potential for Serbia’s development. A strong regulatory framework is an absolute necessity. At the very least, the EU must show it will halt the partnership if Serbia fails to address the governance and practices concerns.