MENA Nations Strategize to Dominate Lithium-ion Battery Market Amid EV Surge

Countries in the Middle East and North Africa (MENA) region, particularly Saudi Arabia and Morocco, are positioning themselves as key players in the lithium-ion battery supply chain.

This could reshape the global electric vehicle (EV) landscape employing a mix of state support, industrial policies, and geopolitical advantages to attract investors and bolster their presence in the EV battery market, according to insights from Benchmark Mineral Intelligence.

Saudi Arabia, renowned for its ambitious economic reforms, is harnessing the power of its Public Investment Fund (PIF), one of the world's largest sovereign wealth funds, to spearhead its economic transition.

A significant portion of the funds, amounting to $182 million, is allocated to mitigate risks in mining ventures, while also offering financing support of up to 75% for capital expenditure (CAPEX), with a preference for advanced exploration and mining activities.

The Kingdom recently revised its mineral resource estimates, doubling them from $1.3 trillion to a staggering $2.5 trillion, encompassing valuable deposits such as rare earths, phosphate, and copper.

To capitalize on this wealth, Saudi Arabia has initiated the development of numerous mining exploration sites and has issued over 30 mining exploration licenses for the year 2024 to foreign investors.

Meanwhile, Morocco, home to approximately 70% of the world's known phosphate reserves, plays a pivotal role in the production of phosphoric acid, a crucial component for lithium iron phosphate (LFP) cathodes.

With the rising demand for next-generation cathode chemistries like LFP and lithium manganese iron phosphate (LFMP), the need for phosphoric acid is set to soar.

Chinese companies, eyeing potential export restrictions on phosphates, are considering establishing operations in Morocco.

These phosphates, essential for fertilizer production, are also vital for manufacturing phosphoric acid.

Benchmark's phosphoric acid market outlook suggests that by 2030, the automotive sector's demand for purified phosphoric acid (PPA) could skyrocket from 5% to 24%.

Morocco has set an ambitious target of producing 100,000 electric vehicles annually by 2025, leveraging its existing automotive capabilities to attract foreign investments.

Major automakers like Renault-Nissan and Stellantis have unveiled plans to expand EV production within the country.

Benefitting from its strategic geographical location bridging Europe and Africa, Morocco's state-owned phosphate giant, OPC, maintains a presence in 16 African countries through subsidiaries, further solidifying its position as a regional EV manufacturing hub.

Source: Green Car Congress