August 30, 2024: African, Caribbean and Pacific states risk being exploited and losing out ecologically and economically in critical raw material supply deals for major EV battery manufacturing players, a new report from the International Institute for Sustainable Development has warned.
According to the report published on August 21 — Critical Raw Materials: A production and trade outlook — subsidy schemes such as the US Inflation Reduction Act and countermeasures launched in the EU are important to expand battery production, help reduce greenhouse gas emissions and accelerate climate action.
However, such schemes that also depend on sourcing nickel, cobalt and lithium from less-developed nations can harm the ability of developing countries to nurture their own green industries, the report said.
In countries such as Zambia and the Democratic Republic of Congo, where the revitalization of transport infrastructure is key for supporting international battery supply chains, those countries also need to ensure their own supply chains are invested in, rather than just allowing the “fast-tracking the export of raw materials” to others.
Countries that have signed critical raw materials agreements with the EU, US and others should consider reviewing the arrangements “with a geopolitical and geo-economic lens to make sure they do not inadvertently harm their development ambitions”, the report said.
Members of the Organization of African, Caribbean, and Pacific States “must ensure that the extraction and processing of such raw materials are aligned with environmental sustainability and social welfare standards.
“This includes implementing and enforcing strict environmental regulations, safeguarding the rights and participation of local communities.”
Battery International’s sister publication, Energy Storage Journal, reported last March that the EU supplies just 1% of its own needs for key battery raw materials.
The report came after a study published last year claimed increasing demand for EV battery metals is fuelling forced evictions and human rights abuses in the Democratic Republic of Congo.
