Belgrade, 19 July 2024 (dpa/MIA) - German Chancellor Olaf Scholz is due to meet Serbian President Aleksandar Vučić in Belgrade on Friday, with the two leaders set to sign an agreement to cooperate on establishing a critical lithium mine.

Scholz, Vučić and European Commission Vice President Maroš Šefčovič are to seal a strategic partnership to mine lithium in north-western Serbia, along with Australian mining giant Rio Tinto.

Lithium, which is essential in the production of renewable batteries, has in recent decades become one of the world's most sought-after natural resources. Serbia's Jadar valley is believed to hold Europe's largest reserves of the valuable mineral.

Rio Tinto has estimated that the mine could produce up to 58,000 tons of lithium per year. The figure would be enough to build 1.1 million electric vehicles, according to Serbian media reports, corresponding to around 17% of total European production.

Car manufacturers Mercedes-Benz and Stellantis are already negotiating a stake in the project with Rio Tinto. The two companies are also set to sign a letter of intent on cooperation with the Serbian government on Friday.

Scholz arrived in Belgrade late on Thursday after attending a European Political Community summit in the United Kingdom. He was greeted by Vučić at the airport after his plane was escorted by Serbian fighter jets.

The German chancellor sees the agreement with Serbia as a chance to reduce Europe's dependence on China as a source of critical raw materials.

For Belgrade, the partnership could help to position the Serbian economy as a key pillar of Europe's green transition, bringing revenue, investment and jobs.

It could also improve the country's ties with the European Union, which have somewhat soured in recent years despite Serbia's official status as a candidate to join the union.

However, the project has proved highly controversial, with environmental activists arguing the mine could contaminate water sources and impact the local community.

The German chancellor's office has argued that involving German companies is the best way to ensure the mine is environmentally friendly.

Photo: dpa