Lithium, Not Oil: The Clean Energy Revolution Will Reshape Global Geopolitics
Just as the Gulf states and their cartel partners fueled postwar global economic growth, those nations who hold the largest deposits of the aforementioned minerals (and others, like graphite) will benefit most from the clean energy revolution.
Should those governments (and their private counterparts) acknowledge this conundrum and choose to enter the industry, they’ll likely grapple with a risky socioeconomic arrangement similar to those they have with human rights violators like Saudi Arabia and Iraq: hear no evil, see no evil. Indeed, while Australia has more than a million metric tons of cobalt in its reserves, other suppliers are not politically promising: Cuba, the Philippines, and Russia round out the top five.
The road to nickel, a plentiful resource, is not perilous like cobalt. Still, its growing importance for battery-making promises to create new winners in the raw material extraction market. Nickel reserves, while not as lopsided as lithium or cobalt, are largest in Australia, Indonesia, and South Africa. The renewed geopolitical emphasis such reserves place on Oceania and Africa would be a particular boon to the latter two nations.
Indonesia, with its massive population, diverse geography, and high economic growth, would be able to translate its nickel rents into geopolitical strength and dominance in the ASEAN region, which could subsequently help Jakarta and its neighbors find allies (like the United States) in their struggle against Beijing’s aggression in the South China Sea. For Pretoria, taking advantage of its nickel reserves could help it to wean itself off its addiction to coal and thus gain international credibility in the fight against climate change, which the country itself suffers greatly from the effects. Further, with its relatively stable and open political system, a rarity in Africa, South Africa will be attractive to risk-averse customers looking for a stable supply on the continent.
The transfer of geopolitical influence from petrostates like Saudi Arabia and Russia to lithium and cobalt-rich nations will be gradual in its process but dramatic in its scope. As the world’s major power blocs lead the charge against climate change and reorient their domestic industrial and economic strategies appropriately, so too will they overhaul their foreign policies and grand strategies. Nations once on the periphery of the global stage will find themselves in the center, wielding their resource endowments to gain respect and raw geopolitical strength. Some emerging stakeholders, like the DRC or Indonesia, are at risk of becoming proxies of the resource hungry. Others, like Chile and Australia, will make easy use of their newfound rents and catapult their way to international prominence. In any case, it will mean the wholesale abandonment of the geopolitical structure that has defined global affairs this last century.
Connor Sutherland is a recent graduate of Rutgers University, New Brunswick, and works as a program assistant at the Council on Foreign Relations. He lives in New York.