Serbia's President Aleksandar Vucic has signalled his intention to approve Rio Tinto's controversial Jadar lithium mining project, following assurances from the company about environmental safety.

Rio Tinto, the Anglo-Australian mining giant, released preliminary drafts of the Environmental Impact Assessment (EIA) on June 13, claiming to demonstrate the safety of the Jadar project. The move has prompted Belgrade to express renewed backing for the project, after revoking its licenses in January 2022 amidst widespread environmental protests.

In an interview with the Financial Times published on June 16, Vucic indicated that the Jadar project would proceed and potentially commence operations as early as 2028. "If we fulfil everything, [the mine] could be opened in 2028," Vucic said, noting the project's capacity to produce 58,000 tonnes of lithium annually, sufficient for 17% of Europe's electric vehicle production. 

The anticipated approval of the Jadar project, projected to become Europe’s largest lithium mine, marks a significant policy shift for Belgrade. The government had previously been forced to U-turn on the project following nationwide protests.

Recent elections in December 2023, won by the ruling Serbian Progressive Party (SNS), seem to have paved the way for the project's revival. In January 2024, Vucic announced that further discussions with Rio Tinto would go ahead, but emphasised the need for greater public discourse on the project's future.

But despite draft studies indicating the project's safety, it remains highly controversial. Environmentalists and local residents warn of increased pollution in a country already facing severe environmental issues. If the government goes ahead with the project, it risks provoking another public backlash and a return of political instability.

On the other hand, the exploitation of Serbia’s lithium reserves, which constitute 1.3% of the world’s known deposits, could be highly lucrative. Valued at approximately €4bn, the extraction process would generate significant revenue for the government and create hundreds of jobs over the next decade.

The project would also further Serbia’s EU accession talks. Lithium is deemed essential by the EU for its green transition. With Europe currently lacking domestic lithium production, the project is expected to meet 13% of the continent's projected demand by 2030, according to Fastmarkets research cited by the Financial Times.

In September 2023, Serbia’s government signed a letter of intent with the European Commission on a strategic partnership in batteries and critical raw materials, including lithium. The involvement of the EU in the renewed agreement is seen by Western officials as a signal of Serbia's geopolitical alignment, especially amid economic and political overtures from China, Russia, and Gulf states.

The official presentation of the project, along with detailed environmental guarantees, is expected in Belgrade next month, where business and political leaders will gather to discuss the future of the Jadar project and its implications for Serbia and Europe.