Zimbabwe Challenges China's Lithium Monopoly with New Refining Rules

Zimbabwe, a leading lithium producer in Africa, is seeking to end China's monopoly over its lithium mining sector. Thanks to substantial investments from Beijing, Zimbabwe has risen to become the world's fourth largest lithium producer.

The southern African nation is now enforcing regulations that compel Chinese companies to refine lithium ore within its borders to increase local profits.

Just five years ago, the town of Gorumonzi in Zimbabwe, located about 40 kilometers away and home to 5,000 residents, was a quiet community focused on horticulture. However, its fate changed dramatically as global competition over this critical mineral, essential for energy transition, intensified.

China's Control Over Zimbabwe's Lithium Industry

Since 2022, the Chinese company Zhejiang Huayou has operated the Arcadia lithium mine in Zimbabwe. Lithium, a key component in electric battery manufacturing, is abundant beneath Zimbabwe’s soil and has become a focal point of geopolitical competition.

As a leading global power, China quickly established a monopoly in Zimbabwe. Besides Arcadia, Chinese firms own all five other industrial lithium mines in the country. These companies have invested heavily in infrastructure, totaling nearly $1.5 billion (1.3 billion euros), exporting their products exclusively to Beijing.

This rapid influx of Chinese capital elevated Zimbabwe to the top lithium producer in Africa and fourth worldwide by 2025, according to Canadian government data, contributing 9.3% of global output.

Zimbabwe's Efforts to Shift Power Dynamics

This financial inflow represents a significant gain for Zimbabwe, a heavily indebted nation long subjected to Western sanctions and isolated from international financial institutions.

Harare is now moving to alter the balance of power by tightening regulations on managing its "white gold." In February, Zimbabwean authorities temporarily banned exports of raw lithium concentrates.

Although the ban was partially eased by granting export quotas, the measure mandates foreign companies, particularly Chinese ones, to build refining plants by January 2027. The goal is to process lithium ore locally into lithium sulfate (lithium powder), thereby increasing export value. Three refineries are under construction in Zimbabwe, with the first operational in Gorumonzi.

New Lithium Refinery and Economic Impact

The lithium refinery in Gorumonzi is the first of its kind in Africa, with an annual production capacity of 50,000 tons of lithium sulfate. This development carries particular significance amid Zimbabwe’s economic challenges, as mineral exports account for about half of its foreign currency earnings.

The export restrictions have begun to yield results, with Harare shipping its first batch of processed lithium in April, signaling growing value addition within the local mining industry.

Meanwhile, lithium export revenues surged in the first quarter of the year, reaching nearly $1 billion—a 79% increase compared to the same period in 2025—driven by higher lithium prices in China.

Government Control and Regional Trends

Mutapa Energy, the mining arm of Zimbabwe’s sovereign wealth fund, confirms the government’s intent to fully control its mines. Similar policies are emerging in other African countries such as the Democratic Republic of Congo, Tanzania, and Namibia, which are imposing export restrictions on minerals to maximize returns.

Legal Framework and Corruption Concerns

Zimbabwe’s current mining law dates back to 1961, from the colonial era, and does not require Chinese companies to invest locally. Since 2014, parliamentary discussions have been ongoing to draft new legislation, but the existing ambiguity continues to exempt mining firms from certain responsibilities.

Lithium, often called "white gold" in the clean energy era, has not escaped allegations of corruption and power struggles. A 2025 study by Transparency International revealed that Chinese companies dominating Zimbabwe’s lithium sector through major acquisitions maintain close ties with influential political, religious, and traditional figures in the country.

The study indicated that these networks have facilitated illegal practices, including smuggling large quantities of raw lithium to Mozambique and South Africa to circumvent export restrictions.