Africa and Mozambique are part of a growing confrontation between the US and China. Mozambique was one of five African countries invited to the United States convened Minerals Security Partnership (MSP) which US Secretary of State Antony Blinken opened on 22 September in New York on the margins of the United Nations General Assembly High-Level Week.
The MSP is part of the US attempt to control critical minerals for the clean energy transition, many of which are now mainly produced in China.
Blinken in particular cited the graphite mine in Balama, Mozambique.
“Graphite from this mine will soon be sent for further processing to a plant in Louisiana, where it will create more jobs and where it will provide graphite used for batteries by American electric vehicle companies.”
The US Department of Energy (DoE) in an 18 April statement said “today the United States is 100% reliant on imported graphite as China produces nearly all of the high-purity graphite needed to make lithium-ion batteries.”
The DoE is providing $107 mn loan to the Australian owners of Balama, Syrah Resources, to build a processing factory in Vidalia, Louisiana, to produce graphite-based anodes for lithium-ion batteries. The DoE said the plant would create “98 good-paying, highly skilled operations jobs within the clean energy sector.”
Yet again, Mozambique gets nothing but a hole in the ground, while the manufacturing is in the US. For a critical mineral such as graphite, which the US wants from a non-Chinese source, Mozambique could have demanded that the processing be in Cabo Delgado. But it did not.
But on the same day Blinken spoke, workers at the Balama graphite mine were on strike, as were 100 workers at the nearby Ancuabe graphite mine, demanding wage increases. (Carta de Moçambique 29 Sept) Work at both mines was halted. Miners claim they are being paid less than the mining minimum wage of $162 per month.
At Balama, Local workers first went on strike on 7 September, calling for wage parity with employees brought in from elsewhere, and for benefits such as health insurance. Zitamar (22 Sept) notes that “the management of the graphite mine, is largely made up of Mozambicans from outside the region, who were evacuated at the start of this week [19 Sept] for fear that protests could turn ugly.”
And there are warnings that as more people are displaced by the new graphite mines, this could fuel the insurgency, as happened with people evicted from the ruby mines and gas project.
China is cutting back on lending to Africa, which means that “developing countries in Africa are losing a champion that for years allowed them to borrow at cheaper rates than they could find in capital markets.” (Bloomberg 7 Oct) China has been particularly important because it lends for long term infrastructure projects such as the Maputo ring road, that could not be funded elsewhere, and funding was without the conditions imposed by the IMF and World Bank.