Zimbabwe Uses Lithium to Fund China Infrastructure Deal

Zimbabwe is exploring mineral-backed loans with China to fund road and railway construction, with finance minister Mthuli Ncube opening talks with China Railway during the World Economic Forum in Dalian.

Under the potential deal being discussed, Zimbabwe would pledge future revenue from natural resources against loans tied to specific infrastructure projects. Mthuli said the government needs to decide which roads to prioritise, what they will cost, and how much of the repayment can be covered by toll fees before it commits to a deal.

The African Development Bank estimates Zimbabwe needs around US$34bn to modernise its logistics networks, due to years of economic mismanagement that have left roads and railways in a poor state.

Zimbabwe is Africa’s biggest lithium producer and its rail network is critical for getting ore to ports for export. China has invested heavily into mining in Zimbabwe, so it has a vested interest in improving the transport infrastructure. 

The country is also preparing to ban exports of raw lithium concentrate from January 2027, forcing Chinese mining operators to process more material inside Zimbabwe.