“I arrived at the Uyuni Salt Flat, in southern Bolivia, after a two-day stop in Potosí, the mythical capital of the conquering fever of silver, at four thousand meters above sea level“. So begins the chapter dedicated to lithium in Gold, Oil and Avocados, the book in which British journalist Andy Robinson intends to give continuity to the Open Veins of Latin America. Fifty years after the first edition of Eduardo Galeano’s legendary text, Robinson tries to show that a dozen raw materials can explain most of the crises, interference, and instability that have affected this part of the world since then. Lithium, in this context, plays the role of a newcomer.

But what is it and why is it becoming so well known?

It is a metal that is often found in association with salt. When processed, it has enormous potential for the use of renewable energies. It is used, rather than for production, to store energy in high-capacity, long-life batteries. These batteries are capable of accumulating wind and solar energy as well as providing life (and autonomy) to all kinds of electronic devices and electric vehicles. Their potential uses range from civilian to military. Moreover, in times of climate change, it is a real (and cheap) alternative to fossil fuels that (like oil) we would be abandoning.

The global market that regulates its price, the first strategic detail to underline, operates in yuan. Last year, its global production grew by 21%. At the same time, its price has risen by 254% in the last five years, reaching 80,000 dollars per ton in March 2022. Oil, which is priced in dollars, has appreciated by less than half (108%) over the same period. Today, a ton of unprocessed lithium brine costs about 20 times less than refined lithium carbonate and about 200 times less than lithium metal, which is used in batteries. Last and final fact: by 2040, according to the IEA, global demand for lithium will increase 42-fold.

Is it now clear why the metal in question is attracting more and more attention?

One of the geopolitical keys lies in knowing where its deposits are located. The answer is not necessarily simple because the distribution of lithium, like any other raw material, is not uniform. Moreover, before mentioning specific locations, the first thing to assume is that the reserves, like those of any other natural resource, must go through a costly and guaranteeing process of international technical certification that allows them to access the status of ‘proven’. In the case of lithium, as its large-scale commercialization is recent, there are still many reserves to be discovered and ‘proven’.

Bolivia is, so far, the country where there is officially more lithium. China, a country of technological reference, is the one with the highest demand and also the largest concentration of producing companies. Here in Latin America, there are considerable reserves: especially at the convergence point among Chile, Argentina, and Bolivia, although it is known that there is also lithium in countries such as Peru and Brazil. And in Mexico where, if the recent discoveries in northern Sonora are confirmed, we could be talking about almost as many reserves as in Bolivia, less than 300 km from the United States.

This panoramic view, unless new deposits will be discovered in other parts of the world, places our region in a privileged strategic position. For the umpteenth time in history, Latin America seems to be well-positioned for an upward economic cycle associated with a global commodity (there are historical precedents such as sugar, silver, coffee, cocoa, gold, guano, rubber, etc.). Main problem: in all these cases, political and technological dependence has tended to favor, simultaneously, the export of raw materials and the import of manufactured goods. This scheme reproduces economic rentiers’ profits, social inequality, and external dependence.

Right now, despite the advances, we are still talking about a kind of metal that, although it seems to have a promising future, is still not being produced or marketed at full capacity. Elon Musk, the world’s richest man and owner of Tesla, recently declared that his company could start mining and refining lithium on a large scale. There are precedents: between 1927 and 1945, the automobile pioneer Henry Ford made a (failed) attempt to produce rubber, in the middle of Amazonia, for the tires of his automobiles.

In Latin America, for the time being, the diversity of approaches and practices prevails. On the one hand, there is Bolivia where, during the presidency of Evo Morales (2006-2019), resources were explored and certified; lithium exploitation was regulated; one of the first public monopolies in the world was created and an agreement was reached with a German company to start extracting and processing. Mexico, where a law defining lithium as a strategic resource has just been passed, seems to share this perspective. But this is not the case for everyone: many governments have already granted concessions to private consortiums, both domestic and foreign, from countries such as China, Australia, Canada, Japan, the United States, South Korea, etc.

In the practical field, it is in commercialization where there are more obstacles right now: basically, it is a matter of discreet pressures from the hydrocarbons lobby and subtle political-market skirmishes, aimed at taking positions. The criticisms that have been directed at Bolivia should be contextualized in a framework such as the one aforementioned: they have ranged from ‘lack of experience’ to an alleged insufficiency of investments, including environmental objections, questions related to transportation, and mentions of the structural weakness of international demand. In this context, abrupt ruptures such as the one that occurred during Jeanine Áñez‘s ‘interim’ should also be considered.

But how to make a change? The current international juncture, with climate change and the War in Ukraine in the background, seems propitious: hydrocarbons are evaporating. In this context, Bolivia is promoting, through multilateral cooperation, safer strategic initiatives. Recently, La Paz, supported by ECLAC, promoted a high-level virtual forum that served as a prelude to a much broader and more participatory face-to-face congress, which should be held before the end of the year. An idea is in the air: to create, as with oil, a cartel of lithium-producing countries. Will it come to that?

Translated from Spanish by Janaína Ruviaro da Silva