If We Want Lithium, Let China Finance It


The surest way to test Canada’s famed affability is to buy their miners and drillers. When it comes to lithium, even minority stakes in companies just exploring for the stuff now appear to be out of bounds: Ottawa just ordered Chinese investors backing three local developers of the battery metal to ditch their shares. Given the deepening rift between China and the West, this may not surprise. But, does it actually help or hinder Canada’s strategic goals?

Foreign investment in a country’s natural resources often comes with hefty emotional baggage; centuries of resource wars and colonialism will tend to do that. The history of oil, for example, is replete with such conflict. Yet that industry has financed the development of gargantuan fields via partnerships between companies hailing from all corners of the globe. Why? Because it’s a good way to raise capital.

In managing the very real risks posed by China’s dual identity as a manufacturing powerhouse and authoritarian regime, there is still room for nuance rather than mere knee-jerks.

Lithium is strategic because it is vital for the millions of batteries required to meet the decarbonization goals set by Canada and many other countries, including the US. Yet, just as net-zero emissions has emerged as a policy priority, so too has net-zero Chinese involvement. Which is a problem, since China controls 70% or more of 11 key segments of the global solar and battery supply chain,…

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