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Government of Serbia is negotiating with the German automobile giant

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Government of Serbia is negotiating with the German automobile giant, the Australian-British company Rio Tinto and a European financial institution on the realization of a project that includes the construction of an electric car factory. According to Demostat, the negotiations are getting closer to a final agreement.

The potential investment depends on whether lithium will be exploited in our country, but also on the foreign policy orientation of the authorities in the coming period.

The decision of the German giant to open a factory in Serbia, with the guarantees of the European Bank for reconstruction and development, would be a clear indicator of the direction Serbia is going – towards the West. The arrival of the German giant from Stuttgart would send a strong message to other major global investors about Serbia as a safe investment destination.

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However, the condition for this and the realization of other investments from the West that are planned is certainly a gradual harmonization with the foreign and security policy of the European Union, which ultimately means the introduction of sanctions against Russia.

European officials made it clear to the Serbian leadership that, if Serbia does not accept the European plan, it can expect consequences that will, among other things, but to a large extent, affect the economy. On the other hand, if the plan is accepted, Serbia was informed that it would receive economic aid, as well as investments in various areas of the economy.

The arrival of Mercedes in Serbia this time will not be limited to government propaganda, as in the case of the cooperation between the German company and Serbian Ikarbus, but, if the contract is signed, it will be agreed upon and implemented, our source claims.

This practically means that Rio Tinto will mine lithium in Serbia, even though the Government of Serbia officially suspended the “Jadar” project at the beginning of last year due to the protests of environmental activists.

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Demostat previously wrote that, if lithium is exploited in Serbia, the condition of the Government of Serbia will be the construction of a battery factory and an electric car factory. At that time, we stated that Serbia will not allow the exploitation of lithium just to export it to other countries. Also, Demostat wrote that there are no guarantees that cooperation with Rio Tinto will be abandoned, but also that the possibility is open for the state to find a new partner, whose reputation has not been damaged as in the case of the British-Australian corporation, which faced international more accusations that it destroys the environment.

That Rio Tinto is not giving up was clear even after Reuters reported the statement of the company’s CEO, who said at a briefing for investors in Sydney in December last year that “Jadar” represents an “incredible value” and that the company has not given up on mining in Serbia. Also, the company Rio Sava does not deny that the purchase of land in the vicinity of Loznica has continued, although the project has allegedly been suspended. In addition, Serbian President Aleksandar Vučić uses every opportunity to emphasize that he is dissatisfied with the fact that lithium mining in Serbia and cooperation with Rio Tinto have been abandoned.

By the way, the company Rio Tinto already cooperated with the European Bank for Reconstruction and Development in 2015 on the project of an underground copper mine in Mongolia.

EBRD in Serbia, among other things, provides support to public-private partnerships and concessions.

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