Experts Warn that Economic Benefits of Jadar Project are Zero At Best

Gornje Nedeljiice (BETAPHOTO/Sasa Djordjević)

A study authored by an experienced businessman, Zoran Drakulic, and economic experts Bosko Mijatovic, Danica Popovic and Dejan Soskic, suggests that the economic effects of the Jadar project are highly uncertain for Serbia, zero at best.

"Based on an economic and financial analysis, while taking into account the enormous risks inherent in implementation of the Jadar project, it is impossible to justify, and should be suspended," the authors said in their study, which Beta had access to. Their research suggests that Serbia, based on projections by Rio Tinto, which is supposed to carry out the Jadar project, might expect negligible revenues across all sources – EUR17.4 million annually, or EUR2.6 euros per capita.

What’s more, Serbia would have to finance the entire infrastructure for the Jadar project alone, and estimates say the cost might soar to a few hundred million euros (roads, railways, water supply, gas pipeline, electrical infrastructure, etc.). Yet it will have no ownership stake in the project, and Rio Tinto would have full control over the extracted lithium.

The authors have underlined that "the Government of Serbia plans to allocate EUR419 million in subsidies, non-transparently and without any guarantees, for the construction of an electric battery factory. Receiving the subsidy is a little-known Slovak company, InoBat, which has no experience in mass industrial production of electric batteries."

"In case of an ecological disaster, Serbia would have to cover alone enormous rehabilitation costs, to the tune of hundreds of millions of euros,” as mining companies, other states, or the European Union, would never agree to bear the financial consequences of an environmental disaster," says the study "How much would Serbia gain from the Jadar project."