Serbia is selling off its resources cheaply, News
In the vicinity is one of the largest deposits of Jadarite, a mineral that contains plenty of lithium, one of the most sought-after raw materials in recent decades.
Without this metal, it is not possible to produce batteries for electric cars, computers or mobile phones. As extremely light, lithium is also used in the aviation industry, and it is also used for the production of rocket fuels.
It can be said that it is a real treasure in the Loznica area, it is estimated that there are about 136 million tons at the largest deposit alone. So much is still found in just one mine each in Chile and Argentina.
However, although the reserves were discovered in 2004, the opening of the mine is still in the pre-preparation phase. The President of Serbia reminded in a disappointing voice that the Serbian government once agreed on an extremely modest ore rent for further interrogation of deposits.
“Now I’m eating alive, I want to go crazy,” Vucic was angry at the pre-election rally. He did not dare to inform the citizens in more detail how much Serbia received from the Canadian company “Rio Tinto”, one of the leading mining companies in the world for research rights and works, which include the right of priority in case of exploitation.
The same issue has been raised several times regarding the three percent of NIS for oil extraction. It was claimed that this was an extremely low rate, just as the Chinese “Zidjan” allocates very little for the extraction of the Bor copper and gold mine.
The legal obligation is five percent of the value extracted from the bowels of the earth. The president was also cautious about the ore rent; he reminded that it would be very difficult to change the long-agreed business conditions afterwards, considering that in both cases the new owners invested a lot.
Also, there are countries, and not a small number of them, which are attracted by leading companies with even lower compensation for extracted resources, so in case we overestimate the compensation, we would run the risk of researchers leaving us.
The public is of the opinion that Serbia is selling off its resources cheaply, especially ores. There is truth in the claim, the legal obligation for the extraction of metal is five, for the extraction of oil seven percent of the value of the extracted quantity.
While it was owned by the state of Serbia, NIS did not pay the ore rent for a long time, only two years before the privatization, a compensation of three percent was determined, increased to seven significantly after Gazpromneft became the new owner. The fee for extracting clay, marl and other construction materials is one percent.
In addition to the ore rent, the state of Serbia directly takes 15 percent of the profits of everyone, even mining companies. The state, the community as a whole, has indirect benefits from the employment and earnings of the local population, cooperation of companies with domestic suppliers and other business partners. There is also a contribution to technological development, a correct attitude towards the local community.
However, it was mostly gained by the development of processing activities based on the extracted ore. The profit, both for the people and for the state, is all the greater because the processing is more modern and with the most final production program. The profit per unit of product is significantly higher in any serious processing plant than in ore extraction.
Let’s see what we would get if, for example, we doubled the ore rent, which often, especially before the elections, party leaders “burn” the masses.
In 2017, when fuel and ore prices were significantly, but not too above the multi-year average, the state obtained 43.3 million euros from ore rent; 10 million came from metal mines and 9 million from oil miners. The rest is for the extraction of coal, construction materials and the exploitation of mineral waters.
Ore rents, the amount of which is estimated by the public to be low, contributed 2.4 billion to the budget. That accounted for less than 0.2 percent of the state treasury, insignificant for the budget.
If we doubled the rent, which is a fierce increase and which would bring us to the top of the world in terms of compensation, we would get another twenty million euros. The question is how questionable it is to get into an argument with companies and risk leaving the local deposits, as happened to us when we increased the fee for extracting deposits of boron raw materials.
It seems that from the call to the level of compensation, it is much more useful to develop domestic mining capacities and a leaning processing industry. At the moment, we are not strong enough to develop large mining companies on our own, where investments are large and the return on investment is slow, it seems that it is more advisable to develop factories for accompanying mining operations.
It would be even more efficient if we developed the processing industry. Not only to extract and smelt ore and sell copper on the stock exchange, but also for the state of Serbia to encourage the establishment and development of companies for numerous processing of red metal.
Not only do we extract lithium, but we also produce batteries and electric cars. Of course, there are many other things that require ore from this area.
The profit from this orientation is through mass employment, earnings, but also technological development, without which it will be very difficult for future generations. At the same time, take care of the protection of the environment, to which, for example, the local oilmen have paid a lot of attention in the last ten years, BiF reports.
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