The Japanese government’s increased interest in Africa’s rare earth minerals, particularly lithium and cobalt, resulted in an agreement being signed with Namibia this week, which aims to enhance mining sector cooperation.
Ultimately, both governments hope to reap the benefits, with Namibia hoping for increased value chains to boost employment and exports, and Japan hoping for access to the minerals to drive their industrialisation agenda. Japan, the island country off the east coast of Asia, intends to work with three African nations, including Namibia, to develop supply chains for cobalt and other minerals critical in manufacturing batteries for electric vehicles.
Japan’s plans for African minerals were reported last week by the Nikkei Group,
which focuses on publishing, broadcasting and the Nikkei 225 stock index.
In a recent article, Nikkei reported that Japan plans to team up with Zambia, the Democratic Republic of Congo and Namibia to expand joint exploration in each country. The projects are scheduled to commence this year. “Japan looks to diversify its sources of critical minerals, including lithium, to enhance economic security and counter China’s growing investment in African countries,” the article reads.
Yasutoshi Nishimura, Japan’s minister of economy, trade and industry, who is visiting Africa, specifically Namibia, Angola and Madagascar for collaboration in the energy space, said Namibia is well endowed with minerals like lithium that are essential for technological innovations.
“I am delighted at being here and signing agreements that are aimed at enhancing collaborations between the two countries,” said Nishimura at a high-level event at State House on Tuesday. Another agreement between Namibia and Japan that was signed this week focuses on collaborating to extensively study rare earth elements in Namibia.
Heading this week’s signing ceremony, green hydrogen commissioner James Mnyupe said the two governments penned an agreement that essentially outlines the intent to collaborate in the areas of critical raw minerals, such as rare earths, lithium and others.
“And, of course, in the space of the production of clean molecules, whether it’s hydrogen or ammonia, for industrial purposes but also decarbonising hard-to-abate sectors as well. Namibia is intending
to work on strategies that are aimed at
looking into sustainable extraction of raw minerals,” said Mnyupe.
Through the strategies, Mnyupe said Namibia is considering venturing into a lithium hydroxide industry and not just mineral extraction. Lithium hydroxide is an inorganic compound in a hydrated form. It can be produced by carrying a reaction of lithium with water in a test tube, along with the formation of hydrogen gas as a by-product.
During this reaction, lithium-ion picks up the hydrogen ion, which later becomes hydrogen atoms. The atoms then form a molecule of hydrogen gas. The negative hydroxide ion left behind combines with lithium to make lithium hydroxide.
The most important use of lithium is in rechargeable batteries for mobile phones, laptops, digital cameras and electric vehicles.
Based on Simonis Storm (SS) estimates released earlier this year, Namibia’s lithium revenues could potentially exceed all other commodities combined, and could therefore significantly improve Namibia’s trade and current account balances and gross domestic product growth rates.
The Lithium Report, compiled by the local stock brokerage, stated, “Given our estimates, the local lithium sector’s revenue
to government would be the largest,
compared to all other commodity mining operations in Namibia.”
In the report, SS noted that restarting lithium production in Namibia after 1998 could be a good development for the local mining industry and the domestic economy. SS pointed out that given the capital-intensive nature of general mining, it does not expect lithium to contribute to socio-economic indicators, such as employment, but it views the renewed interest in Namibian lithium mining as a positive for export earnings and government revenue.
The local stock brokerage estimates the value of the local lithium industry as high
as US$770 million (6.7% of GDP) to
US$364 million (3.2% of GDP), with total taxes paid to government at US$240.1 million and royalties of US$34.3 million.