Zimbabwe’s lithium beneficiation policy: a catalyst for Vision 2030
Zimbabwe must harness its lithium potential through value addition, investment diversification and governance reforms.
As the global green energy transition gains momentum, lithium has emerged as the new gold, particularly in the automotive industry due to its essential role in lithium-ion batteries. The demand for lithium continues to soar, and Zimbabwe stands at a competitive advantage as home to Africa’s largest lithium reserves and ranking among the world's top five in estimated deposits. If managed effectively, lithium beneficiation can drive Zimbabwe towards achieving its Vision 2030, transforming the country into an upper-middle-income economy. A fundamental aspect of this ambitious goal is attaining a GDP growth rate of 8–9% by 2030.
Key investments in Zimbabwe’s lithium sector include Sinomine Resource Group’s US$180 million acquisition of Bikita Minerals in 2022 and Zhejiang Huayou Cobalt’s US$422 million purchase of the Arcadia Lithium Project that same year. Chengxin Lithium entered the sector in 2021 with a 51% stake in the Sabi Star Project, while Canmax Technologies partnered with Premier African Minerals in 2022, providing US$35 million for the Zulu Lithium Project. In 2023, Yahua Group invested US$130 million in the Kamitavi Lithium Project, further boosting the industry.
Additionally, Kuvimba Mining House, Zimbabwe’s state-owned entity, invested in the Sandawana Lithium Project in 2022, aiming to transform it into a high-grade lithium operation.
Beyond these formal investments, unregulated artisanal lithium mining has surged, raising concerns over illegal extraction, environmental degradation and potential state revenue losses.
Overall, this landscape suggests that Zimbabwe’s lithium mining sector is primarily dominated by Chinese firms, reflecting China's broader strategy to secure key minerals for the energy transition.
For years, these firms have exported raw lithium ore to China for processing, with little value addition occurring within Zimbabwe. In response, the Zimbabwean government introduced a lithium beneficiation policy in December 2022 as part of its broader Vision 2030 economic strategy. The key aspects of this policy include a ban on raw lithium exports, designed to attract investment in local lithium processing facilities such as refineries and battery manufacturing plants. Additionally, the policy introduces incentives for local processing, encouraging Chinese firms and other foreign investors to establish lithium beneficiation plants within Zimbabwe. The government has also emphasised state-owned participation, with Kuvimba Mining House overseeing lithium projects to ensure the country derives maximum benefits from its strategic minerals. Furthermore, the policy promotes investment in downstream industries, including lithium battery component manufacturing and, ultimately, full-scale lithium-ion battery production.
Challenges hindering effective policy implementation
Despite its potential, the policy faces several challenges, including capital constraints, infrastructure deficits, skills shortage, corruption, policy inconsistencies, the monopoly position of Chinese firms in the sector and low foreign investor confidence.
The country lacks sufficient capital, reliable energy supply, efficient transport networks, advanced information and communication technology (ICT) infrastructure and technical expertise to fully support lithium industrialisation.
Furthermore, Zimbabwe’s 2000 land reform program, an unfavourable business environment and a deteriorating governance framework have discouraged investment from traditional Western financiers. As a result, the country has become increasingly reliant on China under its Look East Policy. In turn, China appears to be capitalising on Zimbabwe’s economic instability, strained relations with the West and governance weaknesses to maximise its strategic and economic gains.
Chinese firms have established a monopoly in Zimbabwe’s lithium sector, often undermining local beneficiation initiatives by threatening to scale down operations, citing infrastructure challenges, price volatility and policy inconsistencies. For example, in 2024, Bikita Minerals (owned by Sinomine Resource Group) reduced production and cut jobs, attributing the decision to poor infrastructure, inconsistent policies on licensing, taxation and export regulations, as well as fluctuating global lithium prices.
In response, the government adopted a more flexible approach, assessing beneficiation plans on a case-by-case basis. However, this shift has inadvertently exacerbated smuggling and corruption, a pattern also observed in other resource sectors such as diamonds, gold, chromium and iron ore, which are similarly dominated by Chinese firms.
If Zimbabwe addresses these challenges, lithium beneficiation could significantly transform the economy —though it must be part of a broader manufacturing strategy.
A recent study by the African Futures and Innovation Programme at the Institute for Security Studies (AFI-ISS) highlights that beneficiation-driven industrialisation is the key to Zimbabwe achieving its ambitious 2030 growth rate target of 8–9%. According to the study, Zimbabwe’s GDP growth rate will rise from 5.3% in 2023 to an impressive 9.5% by 2030 under the proposed Manufacturing scenario, significantly surpassing the 6.4% growth rate forecast in a business-as-usual (Current Path) scenario.
As a result, the country’s GDP in Market Exchange Rate (MER) will soar from US$19.4 billion to US$28.68 billion, exceeding the US$26.89 billion forecast under the Current Path. At the same time, GDP per capita in Purchasing Power Parity (PPP) will increase from US$2 190 to US$2 690, outpacing the US$2 580 forecast under the Current Path.
Most notably, the successful implementation of the interventions in the proposed Manufacturing scenario will have a transformative social impact—lifting an additional 360 000 people out of extreme poverty (measured as living on less than US$2.15 per day) by 2030, from the 5.6 million forecast under the Current Path.
Similar to Botswana, these findings underscore the potential of Zimbabwe’s beneficiation-driven economic transformation in reshaping the country's future.
Botswana's success with diamond beneficiation proves that Zimbabwe can achieve the same with lithium
The AFI-ISS study also indicates that a synergised approach leveraging transformative scenarios across other critical sectors—such as agriculture, governance, infrastructure and leapfrogging, financial flows, African Continental Free Trade Area (AfCFTA) integration, education and healthcare—is essential for enhancing these socio-economic milestones and unlocking Zimbabwe’s full economic potential.
Strategic measures to maximise lithium beneficiation
To maximise the benefits of lithium beneficiation, Zimbabwe must increase local ownership and participation in the mining and processing industry. This can be achieved by fostering partnerships between foreign firms and local businesses or state-owned enterprises, ensuring that Zimbabweans benefit from the sector. Additionally, supporting indigenous entrepreneurs through financial incentives, skills training and government-backed loans can help create a homegrown lithium processing industry, reducing dependence on Chinese players.
Zimbabwe must also enforce strict regulations on lithium exports while providing incentives for local value addition. Although the government has banned the export of unprocessed lithium, full compliance must be ensured. Export licenses should only be granted to firms that invest in processing plants, while higher taxes should be imposed on raw lithium exports to discourage the practice. At the same time, offering tax holidays, reduced royalties and subsidised electricity for beneficiation projects can encourage investors to establish processing facilities within the country. Establishing Special Economic Zones (SEZs) focused on lithium refining, battery manufacturing and electric vehicle (EV) production can further enhance investment in local industries.
Another critical aspect is infrastructure and energy security. Lithium processing requires a reliable electricity supply, and Zimbabwe’s frequent power shortages pose a major challenge. Investments in renewable energy sources such as solar, wind and hydroelectric power can provide sustainable energy for lithium processing plants. Additionally, improving transport networks, including roads and railways, will lower logistics costs and make Zimbabwe more competitive in the global lithium market. Developing a lithium export corridor with better connections to ports in Mozambique and South Africa will facilitate the movement of processed lithium products to global markets.
Ensuring a transparent and predictable business regulatory environment is also essential to attract investors and sustain industry growth. Policy consistency will reduce uncertainty for investors while enforcing higher royalty payments and tax compliance will ensure that Zimbabwe benefits from its resources. Punitive measures to prevent foreign firms from underreporting exports or engaging in transfer pricing will help Zimbabwe maximise revenue. Additionally, revenue generated from lithium mining should be fairly distributed, particularly to develop mining communities through infrastructure projects and social services.
Beyond lithium mining and refining, Zimbabwe should focus on downstream industries such as lithium-ion battery manufacturing and electric vehicle production. Establishing local battery manufacturing plants will increase economic value, create jobs and position Zimbabwe as a leader in Africa’s lithium value chain. Partnering with regional economies, universities and global tech firms can accelerate skills development, technology transfer and research in battery chemistry and EV technology.
While China currently dominates Zimbabwe’s lithium sector, the government should diversify its investment sources by attracting investors from the European Union (EU), the United States, Japan, African partners, and other capacitated emerging countries such as India. This diversification will reduce reliance on a single foreign power and strengthen Zimbabwe’s global bargaining position. Negotiating better trade agreements for processed lithium exports with global EV manufacturers will help Zimbabwe secure higher-value markets for its refined products, ensuring long-term economic gains.
By prioritising local beneficiation and diversifying investment to lessen China’s monopoly, Zimbabwe can position itself as a key global player in the lithium value chain
Zimbabwe’s lithium beneficiation policy presents a transformative opportunity to drive economic growth, industrialization, and job creation, aligning with Vision 2030. However, its success depends on policy consistency, infrastructure development, governance reforms, and investment diversification. With effective management, lithium beneficiation can establish Zimbabwe as a key player in the global lithium value chain, ensuring long-term economic sustainability and reducing reliance on raw mineral exports.
Image: Alexei_other/Pixabay
