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The race for lithium and the rule of law

22 March 2022

By Professor Sanja Bogojevi膰, Professor of Law, Faculty of Law and Lady Margaret Hall, University of Oxford

An electric black car plugged into a charging point

The future is rosy. This is the warm-bath type of message delivered by the . In 2050, the Strategy assures us, 鈥榳e will still be driving cars, flying planes and heating our homes, but our cars will be electric gliding silently around our cities, our planes will be zero emission allowing us to fly guilt-free.鈥 Climate neutrality, we are comforted to read, will be met without our having to 鈥榮acrifice the things we love鈥 or by creating 鈥winners and losers鈥, contrary to what scholars have warned. One of the reasons offered by the Strategy for this bright future is battery-powered transportation.

A 鈥榮ustainable future鈥 that depends on battery-driven transportation, , relies on a short list of rare materials, including lithium. It is a key component of the lithium-ion battery, the development of which was awarded the in 2019 for its use 鈥榠n everything from mobile phones to laptops and electric vehicles. It can also store significant amounts of energy from solar and wind power, making possible a fossil fuel-free society.鈥 It comes as no surprise, then, that the UK government labels lithium a 鈥榗ritical mineral鈥 vital 鈥樷, or that it is commonly referred to as 鈥榳hite gold鈥. While lithium reserves are , its global production is traceable to only , including Australia, Chile, China and Argentina and, as demand for this precious mineral is estimated to , accessing lithium has become a strategic security question, not only for the UK, which is scheduled to publish its later this year, but also for the . This has set off a , with projects at different stages of development in Austria, the Czech Republic, Finland, Portugal, Spain, and Serbia.

The discovery of lithium in Serbia was led by Rio Tinto, the Anglo-Australian mining venture conglomerate. It had already zoomed in on the Jadar valley in western Serbia in 2004, when it was first issued an exploration permit. It recognised the region鈥檚 potential for becoming 鈥one of the largest greenfield lithium projects in the world鈥, which would ultimately crown Rio Tinto 鈥樷. In 2018, and frequently thereafter, the Serbian government proclaimed the Jadar project to be of 鈥樷 and, in February 2020, it approved continued exploitation, as well as the processing of jadarite mineral, a source of lithium. In November 2021, the Serbian National Assembly, whose ruling party 鈥 the Serbian Progressive Party 鈥 is the political home of the populist President, Alexandar Vu膷i膰, introduced a series of amendments to the Law on Expropriation. These were to allow foreign companies, such as Rio Tinto, to exploit mineral resources with limited opposition from local communities. According to the , private property may be expropriated only in the 鈥榩ublic interest鈥, as established by the law and with compensation not below market value. The Amendments extended the notion of 鈥榩ublic interest鈥 to projects of 鈥榮pecial importance鈥, without further specifications of what could be covered under that heading. Significantly, and in line with the , the executive branch would enjoy the discretion of identifying such projects without any further criteria stipulated. With the increase in mining companies鈥 interest in Serbia, is that international agreements between the Serbian government and foreign companies would readily be deemed of 鈥榮pecial importance鈥, leaving landowners exposed to foreign private investors鈥 demand for land in their mining endeavours. The proposed amendments were met with in Belgrade and across Serbia, and facing general elections later this year, the Serbian government decided to the mining company鈥檚 licenses and to hold a referendum on the future of Rio Tinto鈥檚 presence in Serbia after polling day. Similarly, the amendments to the Law on Expropriation were withdrawn.

Why is this (abbreviated) story relevant in thinking about climate change and the rule of law? In short, it shows that net zero futures are not straightforward and may lead to conflicts that endanger the rule of law. The stakeholders in these conflicts 鈥 as in climate change itself 鈥 are polycentric, and so the UK Net Zero Strategy will come at an environmental cost (as well as other costs), even if not on British shores, and risks fuelling new forms of populist instability. As I have argued , populist politics insist on upholding 鈥榝ormal and procedural鈥 ideals, but under scrutiny, undercurrents of rule-of-law erosion are prevalent. The proposed amendments to Serbia鈥檚 Law on Expropriation provide one example, alongside other transparency issues related to environmental impact assessments of elsewhere in Serbia.

Traditionally, the between populist parties and climate scepticism has been obvious. The narrative of populists, however, is changing. This is not to say that populist parties have altered their course on climate change, but they have found ways to blend it into their own political message. As Catherine Fieschi , climate change fits neatly within the populist narrative of the 鈥榩ure people鈥 versus the 鈥榗orrupt elite鈥, which populists are using to declare that 鈥樷淲e鈥檙e not just going to protect you from climate change鈥e鈥檙e going to protect you from an elite that doesn鈥檛 give a damn about the cost that climate policy is going to take on you.鈥濃 The change of populist narrative maps well onto the recent Jadar experience. In withdrawing Rio Tinto鈥檚 permits, the government was that it had done so on its own accord, and in order to hand back the question to 鈥榯he people鈥 in an upcoming referendum. It underlined that it was not responding to the demonstrators, whom they branded as politically motivated, and that it was instead the government 鈥 not environmental NGOs 鈥 that would ensure that environmental safeguards are upheld. As explains, any opposition, whether institutional or from within civil society, represents a difficulty for populists, as it undermines their claim to being the sole representatives of the people.

Navigating climate-related narratives in populist environments is tricky. In investigating 鈥榳ho were the gilets jaunes?鈥, found an eclectic group rallied around an equally multisided agenda under the broader agenda of anti-fuel charges. Battling out climate disputes 鈥榦n the streets鈥 leaves limited guidance as to which legal arguments are advanced, how disputes are conceptualised, and how these are ultimately resolved. After all, Rio Tinto鈥檚 revoked permits were by some as retaliation by the Serbian government for the decision by the Australian Prime Minister to revoke tennis player Novak Djokovi膰鈥檚 visa ahead of the 2022 Australian Open. This starkly illustrates that we need to be mindful about how conflicts arising from Net Zero Strategies are resolved, and by whom.

The examples mentioned here are Serbia-specific, but they are not exclusive to the Balkans. Lithium-mining projects, currently underway in , , the and , all raise questions of environmental costs carried by local communities as a consequence of battery-centred climate strategies. The future may indeed be rosy, but not for everyone everywhere.

Image credit:听,听, via Wikimedia Commons