Think of a future where cars do not need gasoline, electricity comes from clean energy stored in a powerful battery, and countries that were once overlooked become major players in the global economy. That world is not in the distant future—it’s happening right now. And Ethiopia, a country known for its coffee, rich culture, and ancient history, is stepping into the spotlight for an entirely different reason: lithium.

The hidden force behind our modern world is lithium. Your smartphone, laptop, and, most importantly, your EV batteries are all there. Lithium has become in high demand as the world transitions towards clean energy. Australia, China, and Chile are already billion-dollar industries built around lithium reserves, but Ethiopia is not the only country where it’s present.

You might wonder, “How does a country like Ethiopia fit into this?” There’s a place called Kenticha deep in the southern part of the country. For years, tantalum, a valuable metal used in electronics, was mined from this area. However, recent discoveries have shown that Ethiopia has high-quality lithium deposits that could change the country’s future.

This provides Ethiopia with an opportunity to exploit the resource, attract investors, and change the mining sector. How does this apply to the country? Can lithium become a game-changer? To understand the whole picture, let’s look at the rising demand for lithium, Ethiopia’s mining potential, and the opportunities that come with this new industry.

High Lithium Potential – Ethiopia’s Kenticha mine holds 87.7 million tonnes of lithium ore, making it a potential global supplier.

Growing Global Demand – Lithium demand is expected to increase sixfold by 2035, driven by electric vehicles and renewable energy.

Challenges to Overcome – Poor infrastructure, complex regulations, environmental risks, and local disputes need urgent solutions.

Government Support & Investment – Ethiopia is offering tax breaks, duty-free imports, and easier licensing to attract investors.

Future Outlook – If managed well, Ethiopia’s lithium sector could drive economic growth and position the country as a major lithium exporter.

Source: The Africa Report

Think about the devices you use daily—your phone, laptop, or maybe an electric vehicle (EV).  This has made people ask what fuels them. Lithium. It is a metal that is very much a part of modern society as it is invisible, and the demand for it is expected to rise.

It is pretty shocking that the global demand for lithium has, in fact, increased in the next few years. The global consumption of lithium was around 70,000 metric tons starting in the year 2017. It was 120,000 metric tons in the year 2012, and by the year 2023, it has reached up to 180,000 metric tons and is still rising. The reason? More people are switching to electric cars and renewable energy storage, industries that depend on lithium-ion batteries.

And this is only the beginning. By 2025, experts predict that global lithium demand could exceed 1.4 million metric tons—a staggering increase.

To meet this demand, production is increasing. Lithium production in the global market in 2023 was recorded to be 180,000 metric tons, which was a 23% increase from the prior year. 

But there is a problem—lithium supply chains are under pressure. The global demand for lithium is increasing and it has become rather urgent to find more sources of this material. That is why new entrant countries such as Ethiopia are emerging in the market. 

Ethiopia has a potential for lithium deposits that are yet to be discovered and exploited in the country. If managed well this could very much be a turning point for the country’s economy and for the green energy sector in the world. The question that arises in this context is whether Ethiopia is capable of rising to the challenge.

For years, the Kenticha mine, about 600 kilometers south of Addis Ababa, was famous for tantalum mining. Between 1990 and 2017, it produced around 90 to 95 tons of tantalum concentrate per year, earning Ethiopia roughly $20 million annually. (Wikipedia – Kenticha Mine) But as the world’s focus shifted to electric vehicles and renewable energy, something even bigger was discovered in Kenticha—lithium.

According to Abyssinian Metals, the Kenticha Project contains an estimated 87.7 million tonnes of lithium ore, with an average of 0.78% lithium oxide content. (Abyssinian Metals) That’s a huge find—enough to place Ethiopia among the emerging lithium producers in Africa.

Why does this matter? Lithium is used in rechargeable batteries that drive portable electronic devices, including mobile phones, laptops, and electric vehicles (EVs). Demand for lithium has surged in the international market recently, with 540,000 metric tons consumed in 2021 and more than 3 million metric tons expected in 2030.

Ethiopia is sitting on a goldmine of opportunity, but unlocking it won’t be easy. Mining operations at Kenticha were halted in 2017 due to environmental concerns and local conflicts. Nearby communities raised concerns about pollution and who controls the resources.

However, these challenges are no reason for Ethiopia to surrender. The government and private investors are advancing to resume operations with sustainability. If managed strategically, Ethiopia’s lithium resources can become one of the most significant economic assets that will place the country among the top producers of lithium in the world.

Kenticha is a mine that used to be associated with tantalum and can be found in southern Ethiopia, 600 kilometres away from Addis Ababa. From 1990 to 2017, it produced between 90 to 95 tons per year of tantalum with annual revenues of approximately $20 million.

But now, there is something greater than it, and that is lithium. Recent studies indicate that Ethiopia has the potential to be a major supplier of lithium ore which is 87.7 million tonnes with 0.78% of lithium oxide.

Currently, the world’s demand for lithium is increasing, and it is expected to reach 3 million metric tons by 2030. On this, Ethiopia has a lot of opportunities that could be exploited.

However, things haven’t been smooth. Mining activities were stopped in 2017 mainly because of environmental problems and the rightful ownership of the resources. Today there are attempts by the government and private investors to begin operations the right way, that is, sustainable mining.

Lithium, if managed properly, has the potential to drive economic growth, enhance the industrialization process in Ethiopia, and place the country on the map of international renewable energy producers.

If you are an investor looking for opportunities in Ethiopia’s mining sector. You’d want clear policies, less bureaucracy, and strong government support, right? Well, Ethiopia is working on it. The government has reformed mining laws, making licensing easier and improving transparency to attract serious investors.

To sweeten the deal, Ethiopia offers tax breaks, duty-free imports of mining equipment, and higher royalty payments to encourage foreign investments. These incentives make starting and running mining operations more profitable.

But it’s not just about money. The government has a long-term vision—to ensure mining is sustainable and benefits local communities. They want mining to boost the economy, create jobs, and protect the environment. This balance between growth and responsibility makes Ethiopia’s approach more attractive to ethical investors.

With these strong policies, investor-friendly laws, and long-term planning, Ethiopia is positioning itself as a serious player in the global mining industry.

An industry about to take off, where the potential for growth is massive. That’s exactly what’s happening in Ethiopia’s lithium sector. If you’re looking for a smart investment, now might be the perfect time.

Ethiopia’s mineral-rich lands remain largely unexplored, especially when it comes to lithium. The Kenticha mine, about 600 kilometres south of Addis Ababa, was once famous for tantalum mining. But now, geologists have discovered large lithium reserves in the same area. Running at the front is Abyssinian Metals Limited, seeking responsible mining with an impact at the local level.

Lithium extraction is only the first part of the puzzle, the real profit comes in processing. With an opportunity to refine the raw lithium locally, Ethiopia could export higher-value products and more jobs. This aligns perfectly with Ethiopia’s mining strategy, which prioritizes sustainability and economic growth.

Lithium mining needs roads, energy, and communication networks—and Ethiopia is working on it. The government is investing in better infrastructure, making mining operations smoother and more efficient. These improvements not only help lithium mining but the entire economy.

Lithium mining investors are welcome by the Ethiopian government. To attract foreign investment, they introduced tax breaks and customs duty exemptions and fastened the licensing processes.

Ethiopia is an investment hotspot for lithium with huge lithium reserves, government backing, and increasing global demand. The big issue is, who first will take advantage of it?

Lithium potential in Ethiopia is massive but the development of a successful mining industry will not be easy. There are several key challenges to be resolved so this sector could prove sustainable and profitable.

Poor Infrastructure

Lithium sites in particular are in many mineral rich-areas that do not have essential infrastructure. Mining operations need good roads, electricity, and basic services, but these are still underdeveloped. According to reports, Ethiopia’s mining industry faces major logistical issues due to the lack of roads, power supply, and proper facilities. 

Complicated Regulations

Ethiopia is reforming the mining law, but the system is still hard, especially for foreign investors, in Ethiopia. Permits and approvals, as well as policies, can be unclear and take time. To avoid any legal issues and remain compliant, strong local knowledge is needed by investors.

Environmental Risks

Responsible lithium mining could pollute the environment. Lithium extraction has common problems such as carbon emissions, water contamination, and land degradation. Care must be taken to manage these risks effectively so that sustainability will be achieved in the long run. 

Community Conflicts

Conflicts occur since mining projects affect local communities. Because of pollution concerns and arguments over resource control, operations at the Kenticha mine had been halted in 2017. In order to avoid conflict and share the benefits, companies must cooperate closely with the communities.

So what Ethiopia needs is a collaborative approach, government, investors, and communities must work together. Building a strong lithium industry requires better infrastructure, easier regulations, stricter environmental protections, and better engagement with the communities.

Ethiopia has the potential to become a major lithium supplier, especially as the world shifts toward green energy and electric vehicles. Global lithium demand is expected to grow six times between 2022 and 2035, making this a huge opportunity.

Ethiopia’s Kenticha mine, about 600 kilometers south of Addis Ababa, was once famous for tantalum production. Now, explorations confirm significant lithium deposits, with Abyssinian Metals Limited leading development efforts using community-based mining models.

The Ethiopian government is actively pushing reforms to attract investors. Policies now streamline licensing, improve transparency, and offer tax breaks and duty exemptions on mining equipment.

Source: Mining Business Africa

To fulfill its potential Ethiopia requires strategic transportation, energy, and communication infrastructural investment. Bridging international mining companies will also help bring expertise and capital.

However, challenges remain. Urgent attention is required to poor infrastructure, complex regulations, environmental concerns, and community disputes. The development of a sustainable and profitable mining sector requires collaboration between the government, investors, and local communities.

Ethiopia can be a major global lithium player. If it has the right policies, investments, and partnerships, to support the future of clean energy and its economy.

Ethiopia is now looking forward to exploiting the lithium resources in the country in a bid to position itself as one of the players in the green energy revolution. Lithium is in high demand and global production is 540000 metric tons in 2021 and its production is expected to reach more than 3 million metric tons by 2030.

Ethiopia is taking this opportunity seriously. Minister of Mines Habtamu Tegegn has called lithium the “fuel of the future,” making it a top priority for the country’s mining sector. The Kenticha mine in Oromia, previously known for tantalum production, has now been confirmed to contain substantial lithium deposits. Abyssinian Metals Limited is leading the charge, working on community-based mining models to ensure sustainable development.
However, there are challenges like inadequate infrastructure and regulatory and community issues. With the right approach, Ethiopia can turn its lithium reserves into a major economic driver, helping to power the global shift to renewable energy while ensuring sustainable and inclusive growth.

How does Ethiopia’s lithium compare to other major lithium-producing countries?

 

While Ethiopia is still an emerging player, countries like Australia, Chile, and China dominate lithium production. However, Ethiopia’s high-quality lithium deposits at Kenticha provide a strong foundation for future growth. 

What are the environmental risks of lithium mining in Ethiopia?

 

Lithium mining can lead to water contamination, deforestation, and land degradation if not managed responsibly. Sustainable mining practices and environmental regulations will be key to minimizing these risks. 

Are there any companies currently investing in Ethiopia’s lithium sector?

 

Abyssinian Metals Limited is one of the key players actively exploring lithium resources at Kenticha and working on sustainable mining development.