Democratic Republic of Congo

Executives of the U.S. auto industry – flanked by their cadre of lobbyists – are now busy begging lawmakers for handouts. So far, GM, Ford and Chrysler have failed to present a strong case for using taxpayer money in their resuscitation. We know that Wagoner (GM), Mulally (Ford) and Nardelli (on behalf of Cerberus Capital, owner of Chrysler ) will get one more chance to prove their case once Obama takes office, if not sooner. And regardless of whether the “big 3″ automakers end up filling their golden chalices with federal money, a mandate stipulating an increase in the production of plug-in electric cars will emerge. This much is sure.

So it seems that this is an opportune time to consider what the next era of America’s auto industry might usher in. Let’s start by taking a quick trip back to high school chemistry class since the future of the auto industry and the new fleet of next generation cars starts with the letters “Li” on the periodic table.

The element lithium is one of nature’s more flexible atoms. Lithium salts were used during the 19th century to treat various ailments and millions of people around the world today rely on it to treat psychosis and manic-depression. Lithium is also used as an industrial agent to kill algae and to filter carbon dioxide from the air in spaceships.

Lithium is the lightest metal and the least dense solid element and because of this it is very effective in heat transfer applications used in rechargeable and primary batteries because of its high electrochemical potential, light weight, and high current density. A lithium-ion battery is the “engine” (non-combustion of course) of today’s electric cars and will likely remain so in the foreseeable future.

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China signed a $9 billion deal with the Democratic Republic of the Congo last year to allow China access to the African country’s mineral resources. In return, China plans to invest (by way of Chinese contractors) in a new transportation network—a 1,000-mile road from the Zambian border to northeastern Congo. Infrastructure improvements such as this are coveted in the Congo, one of the poorest countries on the continent.

But China’s investment doesn’t come free; the loans coming from China will need to be paid back in copper, cobalt and road tolls. After that, the two countries will split the profits of Socomin, a new massive mining company, with Congo owning 32 percent and China owning 68 percent.

Concerns over transparency and corruption have left many skeptical of the deal—worrying that China’s billions could end up unaccounted for. Other foreign companies attempting to do business in the Congo have had to jump through far more hoops than China and have had to pay taxes and royalties that China doesn’t. Furthermore, Western companies must adhere to Congo’s mining code—a code that may or may not apply to the Chinese.

For a country in which mining has contributed largely to a slew of social and environmental abuses, (not to mention the country’s second civil war), resource extraction from new mines in the Congo could open up a whole new can of worms. This remains to be seen. But one thing seems clear. The deal has secured a strong foothold on the African continent for China and the Congo may just be getting the short end of the stick. 

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